May 29, 2024

Notice of Convocation
The 158th Ordinary General Meeting of Shareholders

TEIJIN LIMITED

Disclaimer: Please note that the following is a translation of the original Japanese documents prepared for the convenienceof our non-Japanese shareholders with voting rights. Although this translation is intended to be complete and accurate, theJapanese original shall take precedence in the case of any discrepancies between this translation and the 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 registered shareholder authorized toattend the Ordinary General Meeting of Shareholders. Every shareholder attending the Ordinary General Meeting of
Shareholders is required to present the Voting Card to the receptionist at the meeting.

Contents
Message from President and Representative Director, Chief Executive Officer
Notice of Convocation of the 158th Ordinary General Meeting of Shareholders
Reference Documents for the General Meeting of Shareholders
Proposals and Reference
Proposal 1: Election of Seven (7) Directors
Proposal 2: Election of Two (2) Statutory Auditors
Proposal 3: Revision of the Restricted Stock Plan and Performance Share Units Plan for Directors, in Line With the Revisionof the Compensation System for Executive Officers
Attached Reports
Reports on Operations for the 158th Fiscal Year
1. Matters concerning the current status of the Teijin Group (corporate group)(1) Progress and Results of Business Activities(2) Changes in Assets and Profit and Loss
(3) Capital Investment(4) Financing(5) Transfer, Absorption-type Split, or Incorporation-type Split of Business(6) Acquisition or Disposal of Shares, Other Equity Interest, or Stock Acquisition Rights, etc. of Other Companies(7) Significant Subsidiaries(8) Management Policy and Tasks Ahead(9) Principal Business(10) Principal Business Locations, etc.
(11) Employees(12) Primary Lenders and Amount of Borrowings
2. Corporate Governance System
3. Basic Policy Concerning Cross-Shareholdings
4. Matters Regarding the Shares of the Company
5. Matters Regarding Stock Acquisition Rights of the Company
6. Matters Regarding Directors and Statutory Auditors
7. Matters Concerning the Outside Directors and the Outside Statutory Auditors

8. Matters Concerning the Accounting Auditors
9. Summary of a System to Secure Proper Operations and the Status of Use of Said System
10. Basic Policy on Corporate Control
11. Policy Regarding the Determination of Dividends from Retained Earnings
12. 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)Message from President and Representative Director, Chief Executive Officer

Dear Shareholders and investors
First of all, I would like to extend my heartfelt gratitude to you as shareholders and investors for your continued
understanding and support of the Teijin Group's business activities.
In FY2023, the Company’s net sales and operating income both increased from the previous fiscal year.
However, the growth rate was low due to factors including weaker demand for products for some applications
and the impact of customer inventory adjustment in the Materials business, as well as payment of a one-off
lump-sum contract fee and the market entry of generic alternatives in the Healthcare business. Meanwhile, asa result of implementing restructuring initiatives across the Company with a focus on improving the
profitability of three underperforming businesses (aramid business, composites business and healthcare
business) and reforming the management structure of corporate officers and HQ staff, we were generally able
to achieve the results close to the profitability improvement target of 30 billion yen or more. However, among
these businesses, the timing of improvement was pushed back for the stabilization of production in aramidbusiness and composites business. While aramid business was able to achieve improvement in 4Q, composites
business continues to face the issue.
After analyzing these results, we announced our new medium-term management plan for the period throughFY2025 in May, and we will continue to advance our profitability improvement measures throughout theperiod to drive a recovery of fundamental earning power, while carrying out business portfolio transformation,
including the handling of unprofitable and non-core businesses, to achieve the long-term vision of becoming“a company that supports the society of the future.” With an aim to become “a company that prioritizes thehealth of the planet, protects the global environment, and supports a circular society,” and “a company that
addresses issues of patients, families and communities in need of more support,” we will proceed with ourtransform process from a long-term perspective to build an optimal business portfolio and provide value tosociety, so that we can provide care for both the physical and mental health of people and the health of theplanet they live on.
The Company has been conducting a purpose branding activity called the “Journey to One Teijin” since August2023. The objective of this activity is to express the inner passion of each employee, convert tacit knowledge
into explicit knowledge, and clarify the value of existence or the purpose of the Group on a global level. We
strive to enhance our ability to execute by becoming a company where the management and employees sharethe same values and employees identify with such values. Moreover, based on our purpose, we will strengthen
our global management base, such as governance, technology and human capital, and evolve them into afoundation for transformation to put ourselves back on a growth trajectory.
This fiscal year, we will implement “management that is conscious of cost of capital and stock price” bydemonstrating our stance to steadily execute each of these measures including business portfoliotransformation, so that we can meet the expectations of our shareholders.

We look forward to the continued understanding and support of our shareholders and investors.
We also ask our shareholders to exercise their voting rights.

Akimoto Uchikawa
President and Representative Director
Chief Executive Officer

Securities code: 3401
May 29, 2024
Dear Shareholders

Akimoto Uchikawa
President and Representative Director
Chief Executive Officer
Teijin Limited
2-4, Nakanoshima 3-chome,
Kita-ku, Osaka-city,
Osaka 530-8605,
Japan

Notice of Convocation of the 158th Ordinary General Meeting of Shareholders

You are cordially invited to attend the 158th Ordinary General Meeting of Shareholders of Teijin Limited (“the Company”)
to be held as set forth below.
Upon convening a General Meeting of Shareholders, the Company takes measures for providing information that
constitutes the content of reference documents, etc. for the General Meeting of Shareholders in electronic format, and theinformation is posted on each of the following websites on the Internet. Please review the information by accessing one of
the websites.
[Company Website]
https://www.teijin.com/ir/stocks/general-meeting/[Tokyo Stock Exchange's website (Tokyo Stock Exchange listed company search)]https://www2.jpx.co.jp/tseHpFront/JJK020010Action.do?Show=Show
Please access the Tokyo Stock Exchange listed company search above and enter the Company’s name (Teijin) under the “Issuename” or the Company’s securities code (3401) under the “Code” and press “Search.” Click “Basic information,” and select“Documents for public inspection/PR information.” Then check the [Notice of General Shareholders Meeting /Informational
Materials for a General Shareholders Meeting] under “Filed information available for public inspection.”[Website for materials concerning the General Meeting of Shareholders]
https://d.sokai.jp/3401/teiji/*Japanese only

If you do not expect to attend the meeting, you may exercise your voting rights on the Internet or voting card (by mail).
Please review the Reference Documents for the General Meeting of Shareholders, and exercise your voting rights by 5 p.m.,
Wednesday, June 19, 2024 (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.
4

[In case of voting by Internet etc.] Please access to the web-site to exercising voting rights (https://evote.tr.mufg.jp/) throughpersonal 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 thewindow.

5

Details
1. Date and Time of the Meeting:Thursday, June 20, 2024, at 10 a.m. (Japan Time)(The door will open at 9 a.m. (Japan Time))
2. Place:
The Westin Osaka, 2nd Floor, Rose Room, 1-20, Oyodonaka 1-chome, Kita-ku, Osaka, Japan
3. Purposes
Reports
The Business Report, Consolidated Financial Statements, Non-Consolidated Financial Statements and the Reporton the results of audit of Consolidated Financial Statements by the Accounting Auditor and the Board of Statutory
Auditors for the 158th Fiscal Year (April 1, 2023 to March 31, 2024)
Proposals
Proposal 1: Election of Seven (7) Directors
Proposal 2: Election of Two (2) Statutory Auditors
Proposal 3: Revision of the Restricted Stock Plan and Performance Share Units Plan for Directors, in Line
With the Revision of the Compensation System 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 treatsuch “no answer” as your approval for the Company’s proposals.
(2) In the event a shareholder exercises their voting rights several times via the Internet voting system, the final voting
rights exercised shall prevail.
(3) In the event of an overlap in the exercise of voting rights via the voting card for the Exercise of Voting Rights and theInternet voting system, the exercise of voting rights via the Internet voting system shall prevail regardless of the arrival
date of the mailed vote.
(4) In the event of exercising voting rights by proxy, one (1) shareholder with voting rights authorized as your proxy can
attend the General Meeting of Shareholders. However, please note that it will be necessary for the proxy to submit
written proof of power of attorney.

◎ If any modifications occur regarding the notice of the Ordinary General Meeting of Shareholders and the electronic
provision measures, we will post the details of the modifications, both before and after, on the websites as indicatedabove.

6

Reference Documents for the General Meeting of Shareholders
Proposals and Reference Items
Proposal 1: Election of Seven (7) Directors
The terms of office of eight (8) Directors will expire at the conclusion of this General Meeting of Shareholders.
Shareholders are therefore requested to elect the following seven (7) Directors (six (6) of whom are up for reelection). When selecting
candidates for Director, the Nomination Advisory Committee chaired by an Independent Outside Director deliberated on
the candidates based on their “Skills that are particularly expected to contribute for fulfilling the roles and responsibilitiesof the Board of Directors and the Board of Statutory Auditors” (please refer to the skills matrix on page14. The proposal
was then submitted to and approved by the Board of Directors.
The candidates for Director are as follows.
Candidateno.

Candidate
attributes(Gender)Name
Date of birth

Current position andresponsibility

Participation in
Board ofDirectors in
FY202313 times out of
13(100%)

TenureNomination
Advisory
Committee

Compensation
Advisory
Committee

AdvisoryBoard

3 years

○

○

○

1

Reappointment(Male)

AkimotoUchikawa
January 18,
1966

President and Representative
Director,
Chief Executive Officer

2

Reappointment(Male)

NaohikoMoriyama
May 20, 1965

Director, Senior Executive
Officer
Chief Officer, Corporate
Strategy

13 times out of
13 (100%)

3 years3

Reappointment(Male)

1 yearReappointment
OutsideIndependent(Male)
Reappointment
OutsideIndependent(Male)
Reappointment
OutsideIndependent(Female)New
CandidateOutsideIndependent(Female)Director, Executive Officer
Chief Sustainability Officer
Responsible for theEngineering Division
Outside Director

10 times out
of 10(100%)

4

NoboruYamanishi
December 22,
1964
Masaru Onishi
May 19, 1955

13 times out of
13 (100%)

5 years○○○

Masaaki Tsuya
June 22, 1952

Outside Director

13 times out of
13 (100%)

2 years〇〇〇

Tamie Minami
February 15,
1959

Outside Director

10 times out of
10 (100%)

1 year

○

○

○

Reiko
Kusunose
October 2,
1965

－

－

－

5

6

7

“Independent” indicates an independent director as stipulated by the Tokyo Stock Exchange.
A “○” indicates a nominee is a current member of the Nomination Advisory Committee, Compensation Advisory Committee and Advisory
Board in the table above.
Note 1: There are no special interests between any of the candidates and the Company.
Note 2: For “Directors and Officers Liability Insurance Contract”, please refer to the “Directors and Officers Liability Insurance Contract related
to candidates for Director and Statutory Auditor” on page 13.

7

Candidate
No.

Name
(Date of Birth)[Reappointment]

Personal History, Positions and Significant Concurrent Positions

Number ofCompanyʼs
Shares Owned

March 1990
April 2017

Joined Teijin Limited
Teijin Group Corporate Officer
Management Coordinator for the President, Material Business of Teijin
Akimoto Uchikawa
Group
1(January 18, 1966)
Assistant to General Manager, Fibers and Products Converting Business 37,265 shares(FY2023)
Group (for Technology, Production, Restructuring Initiatives)[Participation in the Board April 2020
General Manager, Composites Business Unitof Directors]
April 2021
Teijin Group Executive Officer
13 times out of 13
President, Material Business of Teijin Group(100%)
June 2021
Executive Officer, Director, Teijin Limited
April 2022
President and Representative Director (Incumbent)
Chief Executive Officer (Incumbent)[Reason for nomination of the candidate for Director and expected roles]
Based on his extensive knowledge and experience related to technologies, Akimoto Uchikawa worked on restructuring the Company’s businessand improving its profitability, mainly in the Materials Business including its overseas business. After he assumed the post of President &CEO, Representative Director, he formulated a reform plan to improve the Company’s profitability, and focused on improving the profitabilityof underperforming businesses, while promoting the establishment of a structure to strengthen the ability to execute and the implementationof internal reforms under his strong leadership. The Company determined that it needs his experience and insights in order to increase
shareholder value and corporate value through the realization of the medium-term management plan announced by the Company in May 2024,
decision-making on matters that are significant to the Company, and the execution of operations. The Company therefore continues to selecthim as a candidate for Director.
[Reappointment]
March 1990
Joined Teijin Limited
April 2017
Teijin Group Corporate Officer
Naohiko Moriyama
Management Coordinator for the President, Healthcare Business of Teijin(May 20, 1965)
Group
17,232 shares
2(FY2023)
April 2019
General Manager, Healthcare New Business Division[Participation in the Board April 2021
Teijin Group Executive Officer
of Directors]
President, Healthcare Business of the Teijin Group
13 times out of 13
General Manager, Healthcare New Business Division(100%)
June 2021
Executive Officer, Director, Teijin Limited
October 2022
Chief Officer, Corporate Strategy (Incumbent)
April 2023
Senior Executive Officer, Director (Incumbent)
June 2023
Director, Infocom Corporation (Incumbent)(Significant Concurrent Positions)
Director, Infocom Corporation[Reason for nomination of the candidate for Director and expected roles]
Based on his knowledge and experience related to technologies, Naohiko Moriyama has worked on formulating and promoting theCompany’s growth strategies and implementing reforms in the fields of healthcare business and corporate strategy. In the formulation of themedium-term management plan announced in May 2024, he took a leading role as Chief Officer of Corporate Strategy. The Company
determined that it needs his experience and insights in order to increase shareholder value and corporate value through strategic andappropriate responses to various obstacles and variable factors that may arise in the implementation of the medium-term management plan,
decision-making on matters that are significant to the Company, and the execution of operations. The Company therefore continues to selecthim as a candidate for Director.
[Reappointment]

3

April 1988
April 2017
April 2019

Noboru Yamanishi(December 22, 1964)(FY2023)
April 2023
[Participation in the Boardof Directors]
10 times out of 10(100%)
June 2023
April 2024

Joined Teijin Chemicals Ltd.
Deputy General Manager, Material Technology Center
Teijin Group Corporate Officer
General Manager, Resin and Plastic Processing Business Unit
Teijin Group Executive Officer
Chief Sustainability Officer
Responsible for the Engineering Division and the Corporate
Audit Department
Executive Officer, Director (Incumbent)
Chief Sustainability Officer (Incumbent)
Responsible for the Engineering Division (Incumbent)

8

13,181shares[Reason for nomination of the candidate for Director and expected roles]
Based on his long-standing experience in the fields of production and technology, Noboru Yamanishi has worked on improving the profitabilityof the Company by enhancing quality and productivity mainly in the Resin and Plastic Processing Business. Since being appointed Chief
Sustainability Officer, he has leveraged his business experience to stabilize production activities and manage operational risk. The Company
determined that it needs his experience and insights in order to increase shareholder value and corporate value through the enhancement andstabilization of the Company’s corporate activities during its transformational period, decision-making on matters that are significant to theCompany, and the execution of operations. The Company therefore continues to select him as a candidate for Director.
[Reappointment]
April 1978
Joined Japan Air Lines Co., Ltd.
[Outside] [Independent] April 2007
President, JAL Aircraft Maintenance Narita
April 2009
Executive Officer, JAL International Co., Ltd
June 2009
President, Japan Air Commuter
February 2010
President, Japan Air Lines Corporation (JAL group COO)
President, Japan Air Lines International Co., Ltd.
November 2010
Director, President, Japan Air Lines International Co., Ltd.
Masaru Onishi(Japan Air Lines Corporation merged with Japan Air Lines International(May 19, 1955)
Co., Ltd.)3,512 shares(FY2023)
March 2011
Representative Director and President, Japan Air Lines International Co.,[Participation in the BoardLtd.
4
of Directors]
April 2011
Representative Director and President, Japan Airlines Co., Ltd.
13 times out of 13(The company name was changed from Japan Air Lines International(100%)
Co., Ltd. to Japan Airlines Co., Ltd. in April 2011)
February 2012
Representative Director and Chairperson, Japan Airlines Co., Ltd.
April 2014
Director and Chairperson, Japan Airlines Co., Ltd.
July 2018
External Affairs Representative, Japan Airlines Co., Ltd.
June 2019
Director, Teijin Limited (Incumbent)
Advisory Board member of Teijin Limited (Incumbent)(Significant Concurrent Positions)
Outside Director, Mitsui O.S.K. Lines, Ltd.
Outside Director, Kadoya Sesame Mills Incorporated
Outside Director, Benesse Holdings, Inc.
[Reason for nomination of the candidate for Outside Director and expected roles]
Masaru Onishi had served as Representative Director and President, and Representative Director and Chairperson of Japan Airlines Co. Ltd. As the chair of
the Board of Directors of the Company, he has leveraged his extensive business experience and high level of insight to vitalize and increase the effectiveness of
the Board of Directors, for example by leading in-depth discussions on the formulation of the medium-term management plan announced in May 2024, andoffered appropriate advice and suggestions. The Company determined that in order to increase shareholder value and corporate value, theCompany needs him to supervise decision-making on matters that are significant to the Company and the execution of operations, andprovide advice to the management from an objective standpoint as Outside Director through the Board of Directors, Nomination Advisory
Committee, Compensation Advisory Committee, and Advisory Board. The Company therefore continues to select him as a candidate for
Outside Director.
Note 1: Masaru Onishi is a candidate for Outside Director. The Company requires a candidate for Outside Director to satisfy all the requirements for an
Independent Director as stipulated by the Company. Masaru Onishi satisfies all the prescribed requirements. He also fulfills the requirements for Independent
Director set forth by the Tokyo Stock Exchange. In light of this, the Company has registered Masaru Onishi as an Independent Director with the Tokyo Stock
Exchange. The contents of the requirements of “Independent Director” stipulated by the Company can be viewed at the Company’s website:(https://www.teijin.com/ir/management/governance/requirements/)
Note 2: Masaru Onishi currently serves as an Outside Director of the Company. In accordance with Article 427 of the Companies Act and the Company’s
Articles of Incorporation, the Company and Masaru Onishi have entered into a limited liability agreement in which the limit of liability is ¥20 million or theminimum amount of liability set forth in Article 425, Paragraph 1 of the Companies Act, whichever is higher. When the reappointment of Masaru Onishi as an
Outside Director is approved, the Company will extend its limited liability agreement with him.
Note 3: The date of the first appointment of Outside Director for Masaru Onishi and the tenures in position as Outside Director before the closing of this
General Meeting of Shareholders are follows.
Date of first appointment: June 20, 2019; Tenure in position: 5 years[Reappointment]
April 1976
Joined Bridgestone Corporation[Outside] [Independent] March 2006
Vice President and Officer, Bridgestone Corporation
March 2008
Director, Vice President and Senior Officer, Bridgestone Corporation
September 2011
Representative Director and Senior Vice President Bridgestone
5
Masaaki Tsuya
Corporation
June 22, 1952
March 2012
Representative Director, CEO, Bridgestone Corporation
2,200 shares(FY2023)
March 2013
Representative Director, CEO and Chairperson of the Board, Bridgestone[Participation in the Board
Corporationof Directors]
March 2016
Representative Executive Officer, CEO and Chairperson of the Board,
13 times out of 13
Bridgestone Corporation(100%)March 2020
Chairperson of the Board, Bridgestone Corporation

9

March 2021
June 2022

External Advisor, Bridgestone Corporation (Incumbent)
Director, Teijin Limited (Incumbent)
Advisory Board member of Teijin Limited (Incumbent)(Significant Concurrent Positions)
External Advisor, Bridgestone Corporation[Reason for nomination of the candidate for Outside Director and expected roles]
Masaaki Tsuya consecutively held the post of Representative Executive Officer, CEO and Chairperson of the Board of Bridgestone Corporation. Leveraging
his extensive business experience and a high level of insight, he provides appropriate advice and suggestions as an Outside Director of the Company. As thechair of the Nomination Advisory Committee, he also leads in-depth discussions on matters such as the selection and retirement of Directors
and management members, and the review of the plan to develop CEO successor candidates. The Company determined that in order toincrease shareholder value and corporate value, the Company needs him to supervise decision-making on matters that are significant to theCompany and the execution of operations, and provide advice to the management from an objective standpoint as Outside Director throughthe Board of Directors, Nomination Advisory Committee, Compensation Advisory Committee, and Advisory Board. The Company therefore
continues to select him as a candidate for Outside Director. The amount of transactions between Bridgestone Corporation and the Company accounts
for less than 1% of the consolidated net sales of either company.
Note 1: Masaaki Tsuya is a candidate for Outside Director. The Company requires a candidate for Outside Director to satisfy all the requirements for an
Independent Director as stipulated by the Company. Masaaki Tsuya satisfies all the prescribed requirements. He also fulfills the requirements for Independent
Director set forth by the Tokyo Stock Exchange. In light of this, the Company has registered Masaaki Tsuya as an Independent Director with the Tokyo Stock
Exchange. The contents of the requirements of “Independent Director” stipulated by the Company can be viewed at the Company’s website:(https://www.teijin.com/ir/management/governance/requirements/)
Note 2: Masaaki Tsuya currently serves as an Outside Director of the Company. In accordance with Article 427 of the Companies Act and the Company’s
Articles of Incorporation, the Company and Masaaki Tsuya have entered into a limited liability agreement in which the limit of liability is ¥20 million or theminimum amount of liability set forth in Article 425, Paragraph 1 of the Companies Act, whichever is higher. When the reappointment of Masaaki Tsuya as
an Outside Director is approved, the Company will extend its limited liability agreement with him.
Note 3: The date of the first appointment of Outside Director for Masaaki Tsuya and the tenures in position as Outside Director before the closing of this
General Meeting of Shareholders are follows.
Date of first appointment: June 22, 2022; Tenure in position: 2 years[Reappointment]
June 1995
Joined 3M Company[Outside] [Independent] May 2008
Vice President and General Manager, Home Care Division, 3M
Company
October 2013
Vice President, Southeast Asia Region, 3M Company
6
Tamie Minami
October 2015
Vice President, Latin America Region, 3M Company
February 15, 1959
November 2017
Vice President, Asia Region, 3M Company
0 shares(FY2023)
December 2019
Senior Vice President, Safety and Industrial Business Group, Asia
[Participation in the Board
Region, 3M Company
of Directors]
June 2023
Director, Teijin Limited (Incumbent)
10 times out of 10
Advisory Board member of Teijin Limited (Incumbent)(100%)(Significant Concurrent Positions)
Outside Director, Santen Pharmaceutical Co., Ltd.

[Reason for nomination of the candidate for Outside Director and expected roles]
As Outside Director of the Company, Tamie Minami provides appropriate suggestions and advice from the perspectives of corporate management of multiple
businesses spread across the globe and Diversity Equity & Inclusion, by leveraging her broad knowledge and high level of insight based on her experience ofoverseeing healthcare and industrial material businesses across multiple regions at 3M Company, which is a global company. The Company determined thatin order to increase shareholder value and corporate value, the Company needs her to supervise decision-making on matters that are significant
to the Company and the execution of operations, and provide advice to the management from an objective standpoint as Outside Director
through the Board of Directors, Nomination Advisory Committee, Compensation Advisory Committee, and Advisory Board. The Company
therefore continues to select her as a candidate for Outside Director.
Note 1: Tamie Minami is a candidate for Outside Director. The Company requires a candidate for Outside Director to satisfy all the requirements for an
Independent Director as stipulated by the Company. Tamie Minami satisfies all the prescribed requirements. She also fulfills the requirements for Independent
Director set forth by the Tokyo Stock Exchange. In light of this, the Company has registered Tamie Minami as an Independent Director with the Tokyo Stock
Exchange. The contents of the requirements of “Independent Director” stipulated by the Company can be viewed at the Company’s website:(https://www.teijin.com/ir/management/governance/requirements/)
Note 2: Tamie Minami currently serves as an Outside Director of the Company. In accordance with Article 427 of the Companies Act andthe Company’s Articles of Incorporation, the Company and Tamie Minami have entered into a limited liability agreement in which the limitof liability is ¥20 million or the minimum amount of liability set forth in Article 425, Paragraph 1 of the Companies Act, whichever ishigher. When the reappointment of Tamie Minami as an Outside Director is approved, the Company will extend its limited liability

10agreement with her.
Note 3: The date of the first appointment of Outside Director for Tamie Minami and the tenures in position as Outside Director before theclosing of this General Meeting of Shareholders are follows.
Date of first appointment: June 21, 2023; Tenure in position: 1 year

Candidate
No.

Name(Date of Birth)[New candidate][Outside] [Independent]

Personal History, Positions and Significant Concurrent Positions

April 1990
August 1998
October 2001

7

Reiko Kusunose
October 2, 1965

October 2005
July 2011

June 2013
April 2015
July 2019

February 2020

July 2020

Joined Sumitomo Bank, Limited (currently Sumitomo Mitsui
Banking Corporation)
Joined Hyperion Co. Ltd. (currently Oracle Corporation)
Joined Fuji Heavy Industries Ltd. (currently SUBARUCORPORATION)
Head of Public Relations and Investor Relations, Fuji Heavy
Industries Ltd.
Deputy General Manager, North America Business Planning
Department, SUBARU Overseas Sales & Marketing Division 1,
Fuji Heavy Industries Ltd.
Joined LIXIL Corporation
CFO, Toilet & Vanity GBU, LIXIL Corporation
Corporate Director, LIXIL Corporation
CFO, LIXIL Water Technology Japan
Corporate Officer, LIXIL Corporation
Manager of Finance Standardization Promotion Department,
Finance and Treasury Division, LIXIL Corporation
Joined Nippon Sheet Glass Co., Ltd.
Senior Corporate Officer, Deputy Chief Financial Officer,
Nippon Sheet Glass Co., Ltd.
Senior Executive Officer, Chief Financial Officer, Nippon Sheet
Glass Co., Ltd.

Number ofCompany’s
Shares Owned

0 shares(Significant Concurrent Positions)
Outside Director, Nippo Corporation[Reason for nomination of the candidate for outside director and expected roles]
Reiko Kusunose has accumulated significant experience in corporate reforms and global organizational management at a company in theautomobile industry as well as at companies which went through business mergers. In recent years, she has led these initiatives as CFO. She
has also been actively engaged in Diversity, Equity & Inclusion within and outside companies. As the Company conducts its business globally,
drive corporate reforms, and implement financial strategies to support sustainable growth, we determined that it will be very valuable to theCompany in increasing its shareholder value and corporate value if she supervises decision-making on matters that are significant to theCompany and the execution of operations, and provides advice to the management from an objective standpoint as Outside Director,
leveraging her extensive experience and high level of insight. The Company therefore selected her as a candidate for Outside Director.
Note 1: Reiko Kusunose is a candidate for Outside Director. The Company requires a candidate for Outside Director to satisfy all therequirements for an Independent Director as stipulated by the Company. Reiko Kusunose satisfies all the prescribed requirements. She also
fulfills the requirements for Independent Director set forth by the Tokyo Stock Exchange. In light of this, the Company plans to register
Reiko Kusunose as an Independent Director with the Tokyo Stock Exchange. The contents of the requirements of “Independent Director”
stipulated by the Company can be viewed at the Company’s website: (https://www.teijin.com/ir/management/governance/requirements/)
Note 2: When the nomination of Reiko Kusunose is approved, in accordance with Article 427 of the Companies Act and the Companyʼs
Articles of Incorporation, the Company and Reiko Kusunose will enter into a limited liability agreement in which the limit of liability is¥20 million or the minimum amount of liability set forth in Article 425, Paragraph 1 of the Companies Act, whichever is higher.

Note 3: Reiko Kusunose’s name on the family register is Reiko Ishii.
Note 4: In February 2024 during the period of tenure of Reiko Kusunose as an Outside Director of Nippo Corporation, Nippo
Corporation received information suggesting that its subsidiary may be supplying asphalt mixture, which was manufactured
by mixing recycled aggregate, as virgin mixture, and started investigation few days later. As a result of the investigation,
Nippo Corporation confirmed that asphalt mixture containing recycled aggregate not specified in design specifications had
been used in some of the constructions ordered by the Ministry of Land, Infrastructure, Transport and Tourism and two
expressway companies, which specified the use of virgin mixture. Consequently, Nippo Corporation reported this matter tothe contractees, and considered and discussed how to respond to the incident. Furthermore, Nippo Corporation announced
externally in April 2024 that it will take measures to prevent reoccurrence.
As an Outside Director of Nippo Corporation, Reiko Kusunose has been, at the Board of Directors’s meetings of Nippo

11

Corporation, pointing out the importance of complying with laws and regulations, and making suggestions for supervision
over the operation of whistle-blowing system, as well as supervision over the operation of the risk management system andimprovement thereof.
Once she was aware of the information mentioned above, she has been fulfilling her responsibilities as an Outside Directorof Nippo Corporation by taking steps to ensure compliance and reduce the risk of impairment of corporate value, such as bycommunicating with the management, conducting monitoring to ensure appropriate investigation and response measures areundertaken, and making suggestions once again to strengthen the system to comply with laws and regulations and prevent
recurrence.

Proposal 2: Election of Two (2) Statutory Auditors
The term of office for Statutory Auditors, Akio Nakaishi and Jun Arima shall expire at the close of this General Meetingof Shareholders. This proposal is a request to appoint two (2) Statutory Auditors (one (1) of whom is a candidate forreappointment).
Note the consent of the Board of Statutory Auditors was obtained in advance pertaining to the submission of this proposal.
The candidates for Statutory Auditor are as follows.
Candidate
No.

Name(Date of Birth)[New candidate]1

Tomoko Torii
May 27, 1966

Personal History, Positions and Significant Concurrent Positions
April 1992

October 2003
April 2010
September 2017
May 2019
April 2022

April 2023

Joined Teijin Limited
Overseas Pharmaceutical Development Department, Pharmaceutical
Planning and Research Division, Pharmaceutical Business Unit
Business Development Department, Strategic Planning Office, Teijin
Pharma Limited
President of Academic Planning Group, Pharmaceutical Academic
Division 2, Marketing Office, Teijin Pharma Limited
Pharmaceutical License Group, Pharmaceutical Business Development
Department, Teijin Pharma Limited
General Manager of Investor Relations Department, Teijin Limited
Teijin Group Corporate Officer
Deputy Chief Officer, Corporate Strategy (in charge of stakeholder
communication)
General Manager of Corporate Communication Department
Mission Executive
Deputy Chief Officer, Corporate Strategy (in charge of public relations andinvestor relations, and branding)General Manager of Corporate Branding Department
President and General Manager of Stakeholder Communication Group
Assistant to Chief Officer, Corporate Strategy (Incumbent)
Statutory Auditor, Infocom Corporation (Scheduled to assume office)Number ofCompany’s
Shares Owned

8,438 shares

April 2024
June 2024[Reason for selection as a Statutory Auditor candidate]
Tomoko Torii has extensive business experience in overseas pharmaceutical development, business development and licensing, andmarketing, etc. in the healthcare field based on her scientific and technical knowledge, as well as deep insights into stakeholder
communication including investor relations. She was also in charge of the corporate culture transformation project, and fosteredunderstanding of business activities and corporate culture throughout the Teijin Group as a whole. Her experience and insights are expected
to contribute to the improvement of the effectiveness of operations audit, therefore the Company determined that she will be able to properly
perform her duties as a Statutory Auditor.
Note 1: When the nomination of Tomoko Torii is approved, in accordance with Article 427 of the Companies Act and the Company’s Articles ofIncorporation, the Company and Tomoko Torii will into a limited liability agreement in which the limit of liability is ¥20 million or the minimum
amount of liability set forth in Article 425, Paragraph 1 of the Companies Act, whichever is higher.
Note 2: There is no special interests between Tomoko Torii and the Company.
Note 3: For “Directors and officers liability insurance contract,” please refer to the “Directors and officers liability insurance contract related to
candidates for Director and Statutory Auditor.”

12

Candidate
No.

Name
(Date of Birth)[Reappointment][Outside][Independent]2

Jun Arima(July 23, 1959)[Participation in the
Board of Directors]
13 times out of 13(100%)[Participation in the
Board of Statutory
Auditors]
12 times out of 12(100%)

Personal History, Positions and Significant Concurrent Positions

Joined Ministry of International Trade and Industry (MITI),(Current Ministry of Economic, Trade and Industry (METI))
June 1996
Counsellor, Permanent Delegation of Japan to the OECD
June 1999
Director, Energy Efficiency Policy Coordination, New Energy
Policy Coordination, Energy and Environment Office, ANRE
(Agency of Natural Resources and Energy), MITI
January 2001
Director, International Energy Strategy, ANRE/MITI
June 2002
Head, Country Studies Division, International Energy Agency(IEA)
June 2006
Director, International Affairs Division, ANRE/METI
July 2007
Counsellor, International Energy Negotiation, ANRE/METI
July 2008
Deputy Director General for Global Environmental Affairs, METI
April 2011
Director General, Japan External Trade Organization (JETRO)
LondonSpecial Advisor on Global Environmental Issues, METI
March 2018
Retired METI
Outside Statutory Auditor, Teijin Limited
June 2020(Incumbent)(Significant Concurrent Positions)
Project Professor, Graduate School of Public Policy, the University of Tokyo

Number ofCompany’s
Shares Owned

April 1982

1,400 shares[Reason for selection as an Outside Statutory Auditor candidate]
Although Jun Arima does not have direct experience in corporate management other than being an outside officer, he has been involved ininternational energy policy and environmental policy throughout his career, spanning from the Ministry of International Trade and Industry (current Ministry of
Economy, Trade and Industry to the Graduate School of Public Policy, the University of Tokyo. Since he was appointed as Outside Statutory Auditor of theCompany, he has monitored overall management including from the perspectives of environment and energy, global organizational management, andcompliance, and provided effective advice based on his wealth of knowledge and insights mentioned above. The Company therefore determined that he will beable to properly perform his duties as an Outside Statutory Auditor.

Note 1: Jun Arima is a candidate for Outside Statutory Auditor. The Company requires a candidate for Outside Statutory Auditor to satisfy all therequirements for an Independent Statutory Auditor as stipulated by the Company. Jun Arima satisfies all the prescribed requirements. He also fulfills
the requirements for independence set forth by the Tokyo Stock Exchange. In light of this, the Company has registered Jun Arima as an Independent
Auditor with the Tokyo Stock Exchange. The contents of the requirements of “Independent Statutory Auditor” stipulated by the Company can beviewed at the Company’s website: (https://www.teijin.com/ir/management/governance/requirements/).
Note 2: Jun Arima currently serves as a Statutory Auditor of the Company. In accordance with Article 427 of the Companies Act and the Companyʼs
Articles of Incorporation, the Company and Jun Arima have entered into a limited liability agreement in which the limit of liability is ¥20 million or
the minimum amount of liability set forth in Article 425, Paragraph 1 of the Companies Act, whichever is higher. When the reappointment of Jun
Arima is approved, the Company will extend its limited liability agreement with him.
Note 3: The period of tenure since Jun Arima was appointed as Statutory Auditor will be four (4) years at the close of this General
Meeting of Shareholders (appointment date: June 19, 2020).
Note 4: There are no special interests between any of the candidates and the Company.
Note 5: For “Directors and Officers Liability Insurance Contract,” please refer to the “Directors and Officers Liability Insurance
Contract related to candidates for Director and Statutory Auditor.”◆Directors and Officers Liability Insurance Contract related to candidates for Director and Statutory Auditor
The Company has concluded a Directors and Officers Liability Insurance Contract with an insurance company as stipulated in Article 430-3, Paragraph 1 of theCompanies Act, Under said insurance contract, the legally mandated amount of indemnification and litigation expenses caused by the performance or omission of
the insured’s duties, will be covered. However, claims for damages caused deliberately or through gross negligence will not be covered.
Of those candidates for Director and Statutory Auditor proposed in Proposal 1 (Election of Seven (7) Directors) and Proposal 2 (Election of Two (2) Statutory
Auditors), candidates for reappointment are already covered under the policy policyholders of said insurance contract. Should their reappointment be approved,
they will continue to be covered under the policy. Newly-appointed candidates for Director and Statutory Auditor will be insured party under said insurance
contract should their nomination be approved.
Note that the insurance premiums are covered in full by the Company. In addition, said insurance contracts are scheduled to be renewed in June 2024.

13

(Reference) Skills that are particularly expected to contribute to fulfilling the roles and responsibilities of the Boardof Directors and the Board of Statutory Auditors
The management structure will be as indicated below if Proposal 1 and Proposal 2 are approved as proposed.
Based on the medium-term management plan and management issues, the Company has established a skills matrix, given
the “reasons for selecting skill items.”
From the range of knowledge, experience and abilities each person has, we have indicated the “Skills that are
particularly expected to contribute to fulfilling the roles and responsibilities of the Board of Directors and the Board of
Statutory Auditors,” with the aim of striking an overall balance in the composition of the Board of Directors and theBoard of Statutory Auditors.
The Company is also making efforts to improve diversity, including gender diversity. If Proposal 1 and Proposal 2 areapproved as proposed, the ratio of female executives will be beyond 30% (four female executives: Tamie Minami, Reiko
Kusunose, Tomoko Torii, and Hitomi Nakayama). Please note that Tamie Minami is a non-Japanese national* The table shows skills that are particularly expected to contribute to fulfilling the roles and responsibilities of the Board of Directors and theBoard of Statutory Auditors, and does not represent all of the skills each person has. The criteria for “Functions and foundation” is generally
around two items.

14

<Reasons for selecting skill items>

Proposal 3: Revision of the Restricted Stock Plan and Performance Share Units Plan for Directors, in Line With
the Revision of the Compensation System for Executive Officers
The total maximum annual remuneration for Directors of the Company has been (1) ¥630 million in annual monetarycompensation, etc. for Directors (of which, the maximum annual remuneration for Outside Directors is ¥100 million),(2) ¥70 million for allotment of restricted stock (the total maximum annual number of ordinary shares to be issued or
disposed of is 50,000 shares), and (3) ¥300 million for allotment of performance share units (the total maximum annual
number of ordinary shares to be issued or disposed of is 200,000 shares), as approved in the 155th Ordinary General
Meeting of Shareholders held on June 23, 2021.
The objective of the current restricted stock plan and performance share units plan (hereinafter referred to as the“Current Plan”) is to align with the viewpoint of corporate governance and stakeholders and further strengthen
corporate value creation from a medium- to long-term perspective (sustainability, ESG), and under these plans, theCompany’s ordinary shares are issued or disposed of with a condition to release transfer restrictions upon retirementfrom a position designated in advance by the Company’s Board of Directors in principle. Recently, the Company has
decided to terminate the Current Plan and introduce a new restricted stock plan and performance share units plan as a
new stock compensation plan (hereinafter referred to as the “New Plan”). The objective of the New Plan is, in addition
to the objective of the Current Plan, to increase the motivation to contribute to increasing the Company’s stock value,by adopting an approach to take into account the funds for tax to be paid at the time of release of transfer restrictions
and enhancing the operability of the stock compensation plan. Under the New Plan, the Company will continue toprovide monetary claims to issue or dispose of the Company’s ordinary shares on the condition that transfer restrictions
be released upon retirement from a position designated in advance by the Company’s Board of Directors in principle.
15

In addition, to eliminate the need to sell the Company’s ordinary shares to secure funds for tax to be paid at the timeof release of transfer restrictions, the Company will provide share units for the purpose of securing funds for tax
payment (the Company will pay cash equivalent to the share price per the Company’s ordinary share for each unit.
The actual amount of cash Directors will be able to receive will be calculated by multiplying the number of share units
provided by the share price at the time of disbursement in principle (as defined in “1. Outline of the restricted stockplan” below); hereinafter, “share units”) at the same time as the provision of monetary claims, and pay cash in theamount calculated by multiplying the number of such share units by the share price at the time of disbursement inprinciple (as defined in “1. Outline of the restricted stock plan” below) at the same time, in principle, as the release oftransfer restrictions on the Company’s ordinary shares issued or disposed of under the New Plan.
With this revision, the Company will provide monetary claims for the issuance or disposal of the Company’s ordinary
shares and cash provided based on share units for securing funds for tax payment, which are both treated separatelyfrom the amount of monetary compensation, etc., to Internal Directors who concurrently serve as the Company’s
Corporate Officers (hereinafter referred to as the “Eligible Directors”).
Based on this proposal, remuneration provided for the granting of compensation based on the New Plan to Eligible
Directors shall be monetary claims (for stock portion) and cash (for share units portion) in principle, and the total
maximum number of the Company’s ordinary shares to be issued or disposed of to Eligible Directors as restricted
stock shall be 25,000 shares per fiscal year, and the total maximum amount of monetary claims for the issuance ordisposal of such ordinary shares shall be ¥35 million per fiscal year. Furthermore, the total maximum amount of share
units to be allotted (which is calculated by multiplying the number of share units to be allotted by the share price atthe time of resolution (as defined in “1. Outline of the restricted stock plan” below). Hereinafter the same shall apply
to the total maximum amount of share units) shall be ¥35 million per fiscal year, and the total maximum amount ofcash to be paid based on such share units shall be ¥35 million per fiscal year (*1).

The total maximum number of

the Company’s ordinary shares to be issued or disposed of to Eligible Directors as performance share units shall be
100,000 shares per fiscal year, and the total maximum amount of monetary claims for the issuance and disposal ofsuch ordinary shares shall be ¥150 million per fiscal year. Furthermore, the total maximum amount of share units tobe allotted shall be ¥150 million per fiscal year, and the total maximum amount of cash to be allotted based on suchshare units shall be ¥150 million per fiscal year (*1). The total maximum annual amount of monetary compensation,etc. for Directors will remain the same, which is ¥630 million (of which, the total maximum annual amount for Outside
Directors is ¥100 million).
(*1) In principle, cash provided based on share units is paid when an Eligible Director retires from the position of
Eligible Director or from any other position defined in advance by the Company’s Board of Directors. The total
maximum amount to be paid based on share units is set by taking into account the fact that the total amount ofcash actually paid varies each fiscal year due to factors such as the share price at the time of disbursement,
number of Eligible Directors retiring, and the years of their tenure.
The specific timing for payment and allocation to each Eligible Director shall be determined by the Board of
Directors
upon deliberation by the Compensation Advisory Committee of the Company.
If this proposal is approved, to ensure that the contents conform to the approved contents, a Board of Directors
meeting will be held after the conclusion of this General Meeting of Shareholders to revise the current plan to the
New Plan regarding the decision policy for the contents of individual compensation, etc. for Directors, as stated in“4. (4) 7) Revision of the Restricted Stock Plan and Performance Share Units Plan and Review of Performance16

Indicators in FY2024” of the Business Report.
However, all of the contents of the decision policy are those planned as of the start of the New Plan, and the contents(including performance indicators, targets, performance evaluation period, composition ratio, etc.) are subject tochange by the decision of the Board of Directors during the initial target period (FY2024 and FY2025) within thescope that has received approval via a resolution of the General Meeting of Shareholders. Furthermore, new standards
will be established after the end of the initial target period. There are currently eight (8) Directors (of which four (4)are Outside Directors), of which four (4) are Eligible Directors. If Proposal 1 (Election of Seven (7) Directors) isapproved as proposed, the number of Directors will be Seven (7) (of which four (4) are Outside Directors), of which
three(3) are Eligible Directors.
Furthermore, the upper limits on the amount of monetary claims and cash for the granting compensation based on
the New Plan and the conditions for the granting of compensation based on the New Plan to Eligible Directors such as
the total number of the Company’s ordinary shares to be issued or disposed of and the total amount of share units tobe provided in this proposal are determined in consideration of the above objectives, the status of the Company’sbusiness, decision policy for the contents of compensation, etc., for individual directors of the Company and otherfactors. Consequently, the Company believes that this proposal is appropriate because its contents are required andrational as a remuneration structure.
1. Outline of the restricted stock plan
The restricted stock plan (hereinafter referred to as the “Plan” in this paragraph) is an advance-allotment type sharebased remuneration plan where the Company issues or disposes of the Company’s ordinary shares and allots share
units to each Eligible Director for each fiscal year based on a resolution of the Board of Directors of the Company(*2).
For the stock portion, Eligible Directors are provided with monetary claims for the issuance or disposal of theCompany’s ordinary shares, and Eligible Directors shall in turn pay all monetary claims in the form of property
contributed in kind to receive the Company’s ordinary shares to be issued or disposed of by the Company. The total
maximum number of ordinary shares to be newly issued or disposed of by the Company as a result of the above shallbe no more than 25,000 shares per fiscal year (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 numberof ordinary 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 total maximum amount of monetary claims for issuance or disposal of the Company’s ordinary shares shall be¥35 million per fiscal year. Furthermore, the amount to be paid per share shall be approved by the Board of Directors
based on the closing price of the Company’s ordinary shares 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 said business day, hereinafter referred to as the “Share Price at
the Time of Resolution”) to the extent that Eligible Directors receiving the Company’s ordinary shares do not receive
an especially advantageous price.
For the share units portion, share units shall be provided at the same time as the issuance or disposal of theCompany’s ordinary shares mentioned above. The total maximum amount of share units to be provided as a result of
the above shall be ¥35 million per fiscal year. Allotted share units shall be paid in cash when the transfer restriction on
issued or disposed of ordinary shares of the Company is released, in the amount calculated by multiplying the numberof share units (however, if a share split (including the allotment of ordinary shares of the Company without
17

consideration), a reverse share split, or any other reason in which adjustment of the number of share units takes placeon or after the day share units are allotted, the number of share units will be adjusted to a reasonable extent as necessary.
Hereinafter the same shall apply to the number of share units) by the closing price of ordinary shares of the Company
on the Tokyo Stock Exchange on the day the transfer restriction is released (or the closing price on the trading day
immediately prior thereto if there is no trading on the said day, hereinafter referred to as the “Share Price at the Timeof Disbursement”), in principle. The total maximum amount of cash to be paid based on share units as a result of theabove shall be ¥35 million per fiscal year.

[Specific mechanism of the restricted stock plan]
1) Based on the standard amount by position and job grade, and according to the calculation method described in (1) below,
the number of the Company’s ordinary shares to be issued or disposed of as well as the amount of monetary claims andthe number of stock units to be allotted to each Eligible Director will be determined by the Board of Directors following
deliberation by the Compensation Advisory Committee.
2) Corresponding to the number of the Company’s ordinary shares to be issued or disposed of to each Eligible Director
Determined in 1) above, the Company will provide monetary claims for the issuance or disposal of the Company’s ordinary
shares to each Eligible Director 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 and receive the Company’s ordinary shares
to be issued or disposed of by the Company.
3) To secure funds for income tax that will be imposed upon the release of Transfer Restrictions on the Company’s ordinary
Shares in 2) above, the Company will allot the number of share units determined in 1) above to each Eligible Director, in
addition to the monetary claims in 2) above.
4) For share units in 3) above, in principle, the Company will pay cash to each Eligible Director in the amount obtainedby multiplying the number of share units allotted in 3) above by, in principle, the Share Price at the Time of Disbursement
upon the release of transfer restrictions on the Company’s ordinary shares issued or disposed of in 2), for the purpose of
securing funds for the payment of tax on the Company’s ordinary shares issued or disposed of in 2) above.
(1) Calculation methods for the number of the Company’s ordinary shares to be issued or disposed of, the amount ofmonetary claims to be allotted, the number of share units to be provided, and the amount of cash to be paid based on share
units The Company calculates the number of the Company’s ordinary shares to be issued or disposed of, and the numberof share units to be provided, to each Eligible Director based on the calculation method in 1) below, the amount of monetaryclaims to be allotted to each Eligible Director based on the calculation method in 2) below, and the amount of cash to be
paid based on share units to be provided to each Eligible Director based on the calculation method in 3) below.
1) Calculation method for the number of the Company’s ordinary shares to be issued or disposed of, and the number of2) share units to be provided, to each Eligible Director(i) Number of the Company’s ordinary shares to be issued or disposed of to each Eligible Director (*3)
Disbursement amount based on position and job grade / Share price at the time of resolution X Ratio of allotment (*4)(ii) Number of share units to be provided to each Eligible Director (*3)
Disbursement amount based on position and job grade / Share price at the time of resolution X (100% - Ratio of allotment
mentioned in (i) above) (*5)

18

2) Calculation method for monetary claims to be allotted to each Eligible Director
The Company will calculate the amount of monetary claims to be allotted to each Eligible Director by multiplying the
Number of the Company’s ordinary shares to be issued or disposed of to each Eligible Director, which is calculated using
the calculation method in 1) above, by, in principle, the Share Price at the Time of Resolution. (*3)3) Calculation method for the amount of cash to be paid based on share units
The Company will calculate the amount of cash to be paid to each Eligible Director by multiplying the number of share
Units which is calculated based on the calculation method in 1) above, by, in principle, the Share Price at the Time of
Disbursement.
(*2) However, if after the start of period defined in advance by the Board of Directors (hereinafter referred to as the“Service Provision Period”), an Eligible Director retires from the position defined by the Board of Directors due to reasons
Including expiration of term of office, reaching retirement age, death, or other valid reason before the issuance or disposalof the Company’s ordinary shares and the allotment of share units (excluding cases due to the self-convenience of the
Eligible Director, hereinafter the same applies .), the Company will provide cash to the Eligible Director in an amountReasonably calculated in view of the Eligible Director’s term of office during the said Service Provision Period promptly
after his or her retirement. Additionally, if, after the start of the Service Provision Period, matters relating to a merger
agreement in which the Company is the absorbed company, a share exchange agreement or share transfer plan in which
the Company becomes a 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
a General Meeting of Shareholders of the Company, the Board of Directors of the Company) before the issuance or disposalof the Company’s ordinary shares and the allotment of share units, the Company will pay cash to Eligible Directors in an
amount reasonably calculated in consideration of the period between the start date of the Service Provision Period and theapproval date of said organizational restructuring, etc., based on a resolution of the Board of Directors. Furthermore, if theposition or job grade of an Eligible Director changes after the start of the Service Provision Period and the said Eligible
Director retires from a position designated in advance by the Company’s Board of Directors due to reasons including
expiration of term of office, reaching retirement age, death, or other valid reason, prior to the start of the next Service
Provision Period, the Company will pay cash to the Eligible Director as required in an amount reasonably calculated inconsideration of the timing of the change in position or job grade during the Service Provision Period and the position andjob grade after the change.
(*3) If the result of calculation using the calculation method in (1) 1) through 3) above exceeds the total annual maximum
number of the Company’s ordinary shares to be issued or disposed of (25,000 shares per fiscal year), the total annual
maximum amount of monetary claims to be allotted (¥35 million per fiscal year), the total annual maximum amount ofshare units to be allotted (¥35 million per fiscal year), or the total annual maximum amount of cash to be paid based onshare units (¥35 million per fiscal year), the Company will decrease the number of the Company’s ordinary shares to beissued or disposed of, the amount of monetary claims to be allotted, the number of share units to be allotted, or the amountof cash to be paid based on share units to each Eligible Director by using a reasonable method determined by the Boardof Directors, such as using the pro rata method, so that they will not exceed the upper limits.
(*4) The ratio of allotment refers to the ratio of (1)1)(i) and (ii). The ratio of allotment for the Company’s ordinary sharesin (i) will be calculated within the range between 50% and 100%, and the remaining portion is for share units in (ii).
Furthermore, as a result of the above calculation, if there is a fractional share of the Company’s ordinary shares to beissued or disposed of, it shall be rounded to the nearest whole number.
19

(*5) As a result of the above calculation, if there is a fractional unit of share units to be allotted, it shall be rounded to thenearest whole number.
[Allotment conditions, etc., for Eligible Directors]
If the following conditions are met, the Company will issue or dispose of the Company’s ordinary shares, and provide
share units, to each Eligible Director based on the calculation methods in (1).
1) There has been no certain violation of rules stipulated by the Board of Directors of the Company
2) Other required conditions for restricted stock plan as defined by the Board of Directors of the Company
For the issuance or disposal of the Company’s ordinary shares and payment of monetary claims as property contributedin kind as well as the allotment of share units and payment of cash paid based on share units under this Plan, the Company
and the Eligible Director shall enter into a restricted stock allotment agreement which includes the matters described below.
[Outline of the restricted stock allotment agreement](1) Transfer restriction and period thereof
Eligible Directors may not transfer, create security interests, or make any disposal of the Company’s ordinary sharesthat have been issued or disposed of to them through the restricted stock allotment agreement (hereinafter referred to as
the “Allotted Restricted Shares”) from the date the Company’s ordinary shares are issued or disposed of to Eligible
Directors through the restricted stock allotment agreement to the time immediately after their retirement from a position
defined in advance by the Company’s Board of Directors in principle (hereinafter referred to as the “Transfer Restriction
Period”; the above conditions are hereinafter collectively referred to as the “Transfer Restrictions”). In addition, Eligible
Directors may not transfer, create security interests, or make any disposal of share units that have been allotted to thembased on the restricted stock allotment agreement (hereinafter referred to as the “Allotted Share Units”). However, if thetime immediately after the said retirement is prior to the day after three months have passed since the end of the fiscal year
which includes the date of issuance or disposal of Allotted Restricted Shares, the expiration of the Transfer Restriction
Period may be adjusted to a reasonable extent according to reasons such as retirement, etc.
(2) Release of Transfer Restrictions and payment of cash based on share units
Under the condition that an Eligible Director continuously serves over the Service Provision Period in a position definedin advance by the Company’s Board of Directors, the Company will release all Transfer Restrictions on the Allotted
Restricted Shares and pay the amount obtained by multiplying the Allotted Share Units by, in principle, the Share Price at
the Time of Disbursement upon expiration of the Transfer Restriction Period.
(3) Handling at the case of retirement
Notwithstanding the provisions of (2) above, if an Eligible Director retires from a position defined in advance by the
Board of Directors prior to the expiration of the Service Provision Period due to reasons including expiration of term ofoffice, reaching retirement age, death, or other valid reason , a portion of the Allotted Restricted Shares will have theTransfer Restrictions released immediately after said retirement, and the Company will acquire without consideration any
remaining portions that do not have Transfer Restrictions released. For Allotted Share Units, the Company will pay theamount of cash obtained by multiplying a portion of the Allotted Share Units (reasonably calculated in consideration of
the term of office, etc. of said Eligible Director) by, in principle, the Share Price at the Time of Disbursement, and acquire
without consideration the remaining portions of the Allotted Share Units for which cash will not be paid. Additionally, if
an Eligible Director retires from a position defined in advance by the Board of Directors due to reasons other than20

expiration of term of office, reaching retirement age, death, or other valid reason, the Company will acquire without
consideration all of the Allotted Restricted Shares and Allotted Share Units as a matter of course.
(4) Handling of organizational restructuring, etc.
Notwithstanding the provisions of (2) above, if during the Transfer Restriction Period matters relating to a merger
agreement in which the Company is the absorbed company, a share exchange agreement or share transfer plan in which
the Company becomes a 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
a General Meeting of Shareholders of the Company, the Board of Directors of the Company; only if the effective datearrives before the expiration of the Transfer Restriction Period), the Company will, based on a resolution of the Board of
Directors, release the Transfer Restrictions ahead of the effective date of said organizational restructuring, etc., for thenumber of the Allotted Restricted 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., and pay cash in the amountobtained by multiplying the number of Allotted Share Units determined in consideration of the period between the startdate of the Service Provision Period and the approval date of said organizational restructuring, etc., by, in principle, theShare Price at the Time of Disbursement. Additionally, in the above case, the Company will, as a matter of course, acquire
without consideration all of the Allotted Restricted Shares that have not had Transfer Restrictions released and the Allotted
Share Units for which cash to be paid based on the Allotted Share Units has not been paid, immediately after the Transfer
Restrictions are released.
(5) Other reasons for acquisition without consideration
During the Transfer Restriction Period, if an Eligible Director is sentenced to imprisonment without work or greaterpunishment (including imprisonment after June 1st, 2025), if a petition to commence bankruptcy proceedings, etc. are
filed for an Eligible Director, if the Company’s CEO finds that an Eligible Director is engaged in operations, etc., thatcompete with the Teijin Group’s business without prior authorization from the Company or plans to engage in suchoperations, etc. after retirement (in the case the Eligible Director is the CEO, if the Board of Directors passes a resolution;
hereinafter the same applies), or if the Company’s CEO finds that an Eligible Director has violated laws, regulations or
the Company’s internal regulations, etc., the Company is able to acquire without consideration all of the Allotted Restricted
Shares and Allotted Share Units as a matter of course.
(6) Other matters
Other matters regarding the restricted stock allotment agreement shall be defined by the Board of Directors of theCompany.
2. Outline of the performance share units plan
The performance share units plan (hereinafter referred to as the “Plan” in this paragraph) is a post-allotment type sharebased remuneration plan in which the Board of Directors of the Company establishes in advance an evaluation period
comprising one or more fiscal years of the applicable fiscal years under the Company’s medium-term management plan(hereinafter, “Performance Evaluation Period”) and one or more performance indicators from among the performanceindicators set in the medium-term management plan (including sustainability-related indicators, hereinafter the same). The
Company issues or disposes of ordinary shares to, and provides share units to, Eligible Directors, according to the level ofachievement of said performance indicators.
21

For the stock portion, Eligible Directors are provided with monetary claims for the issuance or disposal of theCompany’s ordinary shares, and Eligible Directors shall in turn pay all monetary claims in the form of property contributedin kind to receive the Company’s ordinary shares to be issued or disposed of by the Company. As such, the provision ofmonetary 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 set for each performance indicator. The total maximum number ofordinary shares to be issued or disposed of by the Company as a result of the above shall be 100,000 shares per fiscal year
(however, if a share split (including 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" is required takes place on or after the day on which this proposal is approved
and adopted, such total number will be adjusted to as reasonable extent as possible). The total maximum amount ofmonetary claims for the issuance or disposal of the Company’s ordinary shares shall be ¥150 million per fiscal year.
Furthermore, the amount to be paid per share shall be approved by the Board of Directors based on the Share Price at theTime of Resolution to the extent that the Eligible Directors receiving the Company’s ordinary shares do not receive anespecially advantageous price.
For the share units portion, share units shall be provided at the same time as the issuance or disposal of the Company’s
ordinary shares mentioned above. The total maximum amount of share units to be provided as a result of the above shallbe ¥150 million per fiscal year. Allotted share units shall be paid in cash upon the release of Transfer Restrictions on issued
or disposed of ordinary shares of the Company, in the amount calculated by multiplying the number of share units by, inprinciple, the Share Price at the Time of Disbursement. The total maximum amount of cash to be paid based on share units
as a result of the above shall be ¥150 million per fiscal year.
Additionally, the Plan provides for the issuance or disposal of our company’s common shares and the provision ofmonetary claims for the issuance or disposal of our company’s common shares, as well as the granting of stock units,
based on the achievement level of the performance indicators mentioned above, nothing is determined before the said levelof achievement is confirmed with regard to whether or not to dispose or provide them to each Eligible Director, the numberof the Company’s ordinary shares to be issued or disposed of, or the amount of monetary claims and the number of share
units for the issuance or disposal of the Company’s ordinary shares to be provided to each Eligible Director.
Furthermore, although the Performance Evaluation Period and performance indicators during the initial period (fromFY2024 to FY2025) are planned to be those stated in the Business Report, the contents (including performance indicators
used as the basis of calculation, targets, performance evaluation period, composition ratio, etc.) are subject to change
during the initial Performance Evaluation Period by the decision of the Board of Directors within the scope that hasreceived approval via a resolution of the General Meeting of Shareholders, and the Company may continue to implement
the Plan by setting a new performance evaluation period and performance indicators, etc. after the end of the initial
Performance Evaluation Period.
[Specific mechanism of the performance share units plan]
1) Following deliberation by the Compensation Advisory Committee, the Board of Directors of the Company will
determine the performance indicators required for the calculation of the number of the Company’s ordinary shares to beissued or disposed of and the amount of monetary claims to be provided to each Eligible Director, as well as the numberof share units to be provided to and the amount of cash to be paid based on share units to each Eligible Director under thePlan, the Performance Evaluation Period thereof, the targets, composition ratios, and evaluation of the level of achievement.
2) In principle, the Company will determine the number of the Company’s ordinary shares to be issued or disposed of andthe number of share units to be provided to each Eligible Director after the conclusion of the Performance Evaluation
22

Period set for each performance indicator, corresponding to the level of achievement of the targets in each performance
Indicator and other factors during the Performance Evaluation Period. For performance share units, the payment amountvaries within the range from 0% to the upper limit defined in advance by the Company’s Board of Directors, according to
the achievement level of each performance indicator.
3) Corresponding to the number of the Company’s ordinary shares to be issued or disposed of to each Eligible Director
determined in 2) above, the Company will provide monetary claims for the issuance or disposal of the Company’s ordinary
shares to each Eligible Director 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 and receive the Company’s ordinary shares
to be issued or disposed of by the Company.
4) To secure funds for income tax that will be imposed upon the release of Transfer Restrictions on the Company’s ordinary
shares in 3) above, the Company will allot the number of share units determined in 2) above to each Eligible Director, in
addition to the monetary claims in 3) above.
5) For share units in 4) above, the Company will pay cash to each Eligible Director in the amount obtained by multiplying
the number of share units allotted in 4) above by, in principle, the Share Price at the Time of Disbursement upon, in
principle, the release of transfer restrictions on the Company’s ordinary shares issued or disposed of in 3), for the purposeof securing funds for the payment of tax on the Company’s ordinary shares issued or disposed of in 3) above.
(1) Calculation methods for the number of the Company’s ordinary shares to be issued or disposed of, the amount ofmonetary claims to be allotted, the number of share units to be provided, and the amount of cash to be paid based on share
units
The Company calculates the number of the Company’s ordinary shares to be issued or disposed of, and the number ofshare units to be provided, to each Eligible Director based on the calculation method in 1) below, the amount of monetaryclaims to be allotted to each Eligible Director based on the calculation method in 2) below, and the amount of cash basedon share units to be provided to each Eligible Director based on the calculation method in 3) below.
1) Calculation method for the number of the Company’s ordinary shares to be issued or disposed of, and the number ofshare units to be provided, to each Eligible Director(i) Number of the Company’s ordinary shares to be issued or disposed of to each Eligible Director (*6)
Standard amount for stock compensation based on position and job grade X Payment rate (*7) / Share Price at the Timeof Resolution X Ratio of allotment (*8)(ii) Number of share units to be provided to each Eligible Director (*6)
Standard amount for stock compensation based on position and job grade X Payment rate (*7) / Share Price at the Timeof Resolution X (100% - Ratio of allotment mentioned in (i) above) (*9)2) Calculation method for monetary claims to be allotted to each Eligible Director
The Company will calculate the amount of monetary claims to be allotted to each Eligible Director by multiplying thenumber of the Company’s ordinary shares to be issued or disposed of to each Eligible Director, which is calculated using
the calculation method in 1) above, by, in principle, the Share Price at the Time of Resolution. (*6)3) Calculation method for the amount of cash to be paid based on share units
The Company will calculate the amount of cash to be paid to each Eligible Director by multiplying the number of share
units which is calculated based on the calculation method in 1) above, by, in principle, the Share Price at the Time of23

Disbursement (*6).
(*6) If the result of calculation using the calculation method in (1) 1) through 3) above exceeds the total annual maximum
number of the Company’s ordinary shares to be issued or disposed of (100,000 shares per fiscal year), the total annual
maximum amount of monetary claims to be allotted (¥150 million per fiscal year), the total annual maximum amount ofshare units to be allotted (¥150 million per fiscal year), or the total annual maximum amount of cash to be paid based onshare units (¥150 million per fiscal year), the Company will decrease the number of the Company’s ordinary shares to beissued or disposed of, the amount of monetary claims to be allotted, the number of share units to be allotted, or the amountof cash to be paid based on share units to each Eligible Director by using a reasonable method determined by the Boardof Directors, such as using the pro rata method, so that they will not exceed the upper limits.
(*7) The ratio of allotment will vary within a certain range that is determined in advance by using a method defined by the
Board of Directors of the Company, and the ratio for each Eligible Director shall be determined by the Board of Directors
after deliberation by the Compensation Advisory Committee of the Company, by taking into the level of achievement of
the targets in each performance indicator and other factors during the Performance Evaluation Period.
(*8) The ratio of allotment refers to the ratio of (1)1)(i) and (ii). The ratio for the Company’s ordinary shares in (i) will becalculated within the range between 50% and 100%, and the remaining portion is for share units in (ii). Furthermore, as aresult of the above calculation, if there is a fractional share of the Company’s ordinary shares to be issued or disposed of,it shall be rounded to the nearest whole number.
(*9) As a result of the above calculation, if there is a fractional unit of share units to be allotted, it shall be rounded to thenearest whole number.

(2) Allotment conditions for Eligible Directors
If the following conditions are met after the end of the performance evaluation period, the Company will issue or disposeof the Company’s ordinary shares, and provide share units, to each Eligible Director based on the calculation methods inabove (1) (*10, 11, 12).
1) The Eligible Director was in a position designated by the Company’s Board of Directors for the entirety or a portion of
the performance evaluation period
2) There has been no certain violation of rules stipulated by the Board of Directors of the Company
3) Other required conditions for performance share units plan as defined by the Board of Directors of the Company(*10) If an Eligible Director retires due to expiration of term of office, reaching retirement age, death, or other valid reason
during the Performance Evaluation Period, the Company will make a calculation after making reasonable adjustments tothe number of shares and the number of share units as needed, in consideration of factors including the term of office up
to the time of retirement during the Performance Evaluation Period, the position and job grade of the Eligible Director
during the said period, and the achievement level of targets for each fiscal year as of the time of retirement, which areseparately defined for each performance indicator.
(*11) If an Eligible Director retires due to expiration of term of office, reaching retirement age, death, or other valid reason
during the Performance Evaluation Period, the Company will issue or dispose of the number of Company’s ordinary sharescalculated in accordance with (*10) above and allot the number of share units calculated in accordance with (*10) above
to the Eligible Director (if the retirement is due to death, then the rights successor to the Eligible Director) within areasonable period after retirement.
24

(*12) If, after the start of the Performance Evaluation Period, matters relating to a merger agreement in which the Company
is the absorbed company, a share exchange agreement or share transfer plan in which the Company becomes a whollyowned 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 the Company, the Board of Directors of the Company) before the issuance or disposal of the Company’s
ordinary shares and the allotment of share units, the Company will allot the Company’s ordinary shares and share units or
pay cash to Eligible Directors based on a resolution of the Board of Directors. If allotting ordinary shares and share units,
the Company will issue or dispose of the Company’s ordinary shares to Eligible Directors ahead of the effective date ofsaid organizational restructuring, etc., in consideration of factors including the period between the start date of the
Performance Evaluation Period and the date of approval of said organizational restructuring, etc., the positions or job
grades of the Eligible Directors during the said period, and the level of achievement of targets in performance indicators
as of the time of said resolution of the Board of Directors, with reasonable adjustments made to the number of shares andshare units as needed. For share units, the Company will pay cash in the amount obtained by multiplying the number ofshare units by, in principle, the Share Price at the Time of Disbursement upon the release of Transfer Restrictions on the
Company’s ordinary shares mentioned above. When paying cash, the Company will pay to Eligible Directors an amountof cash reasonably calculated in consideration of factors including the period between the start date of the Performance
Evaluation Period and the date of approval of said organizational restructuring, etc., the positions or job grades of the
Eligible Directors during the said period, and the level of achievement of targets in performance indicators as of the timeof said resolution of the Board of Directors.
For the issuance or disposal of the Company’s ordinary shares and payment of monetary claims as property contributedin kind as well as the allotment of share units and payment of cash paid based on share units under this Plan, the Company
and the Eligible Director shall enter into a performance share units allotment agreement which includes the mattersdescribed below.
[Outline of the performance share units allotment agreement](1) Transfer restriction and period thereof
Eligible Directors may not transfer, create security interests, or make any disposal of the Company’s ordinary sharesthat have been issued or disposed of to them through the performance share units allotment agreement (hereinafter referred
to as the “Allotted Performance Share Units”) from the date the Company’s ordinary shares are issued or disposed of to
Eligible Directors through the performance share units allotment agreement to the time immediately after their retirementfrom a position defined in advance by the Company’s Board of Directors in principle(hereinafter referred to as the“Transfer Restriction Period”; the above conditions are hereinafter collectively referred to as the “Transfer Restrictions”).
In addition, Eligible Directors may not transfer, create security interests, or make any disposal of share units that havebeen allotted to them based on the performance share units allotment agreement (hereinafter referred to as the “Allotted
Share Units”). However, if the time immediately after the said retirement is prior to the day after three months have passed
since the end of the fiscal year which includes the date of issuance or disposal of Allotted Performance Share Units, theexpiration of the Transfer Restriction Period may be adjusted to a reasonable extent according to reasons such as retirement,
etc.
(2) Release of Transfer Restrictions and payment of cash based on share units
Under the condition that an Eligible Director continuously serves over the Transfer Restriction Period in a position25

defined in advance by the Company’s Board of Directors, the Company will release all Transfer Restrictions on the Allotted
Performance Share Units and pay the amount obtained by multiplying the Allotted Share Units by, in principle, the Share
Price at the Time of Disbursement upon expiration of the Transfer Restriction Period.
(3) Handling at the case of retirement
Notwithstanding the provisions of (2) above, if an Eligible Director retires from a position defined in advance by the
Board of Directors of the Company due to reasons other than expiration of term of office, reaching retirement age, death,or other valid reason, the Company will acquire without consideration all of the Allotted Performance Share Units andAllotted Share Units as a matter of course.
(4) Handling of organizational restructuring, etc.
Notwithstanding the provisions of (2) above, if during the Transfer Restriction Period matters relating to a merger
agreement in which the Company is the absorbed company, a share exchange agreement or share transfer plan in which
the Company becomes a 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
a General Meeting of Shareholders of the Company, the Board of Directors of the Company; only if the effective datearrives before the expiration of the Transfer Restriction Period), the Company will release the Transfer Restrictions aheadof the effective date of said organizational restructuring, etc., for all of the Allotted Performance Share Units, and pay cashin the amount obtained by multiplying all of the Allotted Share Units by, in principle, the Share Price at the Time of
Disbursement ahead of the effective date of said organizational restructuring, etc.
(5) Other reasons for acquisition without consideration
During the Transfer Restriction Period, if an Eligible Director is sentenced to imprisonment without work or greaterpunishment (including imprisonment after June 1st, 2025), if a petition to commence bankruptcy proceedings, etc. are
filed for an Eligible Director, if the Company’s CEO finds that an Eligible Director is engaged in operations, etc., thatcompete with the Teijin Group’s business without prior authorization from the Company or plans engage in such operations,etc. after retirement (in the case the Eligible Director is the CEO, if the Board of Directors passes a resolution; hereinafter
the same applies), or if the Company’s CEO finds that an Eligible Director has violated laws, regulations or the Company’s
internal regulations, etc., the Company shall be able to acquire without consideration all of the Allotted Performance Share
Units and Allotted Share Units as a matter of course.
(6) Other matters
Other matters regarding the performance share units allotment agreement shall be defined by the Board of Directors of
the Company.
*The following information is provided as reference material to enable readers to better understand the proposal. It does
not form part of the proposal.
[Reference] The upper limit of the total amount of compensation for executive officers per fiscal year and the method ofdetermining compensation amounts after the revision.
The upper limit of monetary compensation for directors is ¥630 million, of which ¥100 million is the upper limit ofmonetary compensation for outside directors. Furthermore, the upper limit of restricted stock is ¥35 million (25,000 shares)
26

for the stock portion, and ¥35 million in total for share units to be allotted, and ¥35 million in total for cash to be paid
based on share units for the share units portion. The upper limit for the performance share units is ¥150 million (100,000
shares) for the stock portion, ¥150 million in total for share units to be allotted, and ¥150 million in total for cash to be
paid for the share units portion.
The amounts of compensation, etc. for directors are determined based on deliberation in the Compensation Advisory
Committee, in consideration of a third-party survey on remuneration of corporate management in which leading
corporations in Japan participate.

<New plan ><Current plan >Performance share unit

Performance share units

Up to 300 million yen

Stock
Up to 150 million yen,
Maximum number of shares; 100,000

Maximum number of shares;
200,000

Cash to be paid based on share units *Up to 150 million yen
Restricted stock

Restricted stock

Up to 70 million yen

Stock
Up to 35 million yen,
Maximum number of shares: 25,000

Maximum number of shares;
50,000Cash to be paid based on share units *Up to 35 million yen

Monetary compensation

Monetary compensation

Up to 630 million yen

Up to 630 million yen

Outside Directors

Outside directors

Up to 100 million yen

Up to 100 million yen*In addition to the upper limit of the total amount of cash to be paid based on share units, the upper limits for the total
amount of share units to be allotted at the same time as the issuance or disposal of the Company’s ordinary shares are
set as ¥35 million for restricted stock and ¥150 million for performance share units.

27

1. Matters Concerning the Current Status of the Teijin Group (corporate group)(1) Progress and Results of Business Activities
1) Overview
In FY2023, social and economic activities began to return normal as the spread of COVID-19 subsided, however,the future of the global economy remained uncertain due to prolonged monetary tightening in Europe and the U.S., aslowdown in China’s economy mainly due to its sluggish real estate market, and heightened geo-political risks arisingfrom factors such as the prolonged situation in Ukraine and rising tensions in the Middle East.

In light of the fact that the Teijin Group was unable to achieve the financial targets set in the previous medium-term
management plan, the Group announced the Teijin Group Reforms for Profitability Improvement in February 2023,
and focused on improving profitability in FY2023 as a top priority issue with the aim of returning to growth. Under the
new management structure which was transformed to promote the acceleration of management decisions andexecution, the Group worked on improving the profitability of mainly the composites, aramid, and healthcare
businesses, which were designated as the three underperforming businesses. While the targets for profitability
improvement measures were mostly achieved as planned, the composites business struggled to stabilize theoperation of plants. As a result, the full-year target for improvement was not achieved in the composites business.
For FY2023, the Teijin Group’s net sales amounted to 1,032.8 billion yen, an increase of 1.4% year on year, andoperating income was 13.5 billion yen, an increase of 5.3% year on year. Ordinary income was 15.6 billion yen, an
increase of 71.0% year on year mainly due to an increase in equity in earnings of affiliates, while the Group’s profit
attributable to owners of parent was 10.6 billion yen. (In FY2022, the Group recorded 17.7 billion yen in loss
attributable to owners of parent due to the recording of impairment losses, etc.) In terms of the operating income,although the Materials Business Field was affected by weaker demand for products for some applications, operating
loss was reduced mainly due to the effect of profitability improvement measures and insurance income. The Fibers &Products Converting Business experienced strong sales, achieving an increase in operating income. The Healthcare
Business Field experienced a decrease in operating income mainly due to the payment of an extraordinary lump-sum
pharmaceutical contract fee, a decline in the sales volume of gout and hyperuricemia treatment FEBURIC that wascaused by the market entry of generic alternatives, and drug price revisions. On the other hand, the operating incomeof the IT Business increased due to robust sales.

As a result, ROE, an indicator of profitability, was 2.4%, and ROIC based on operating income was 1.6%. EBITDA,
an indicator of the ability to generate cash, was 92.4 billion yen.

In FY2023, two organizations for the development of new businesses previously under the supervision of the
President of the Material Business of Teijin Group and the President of the Healthcare Business of Teijin Group weretransferred from “Material” and “Healthcare” segments to the “Others” segment. This change was related to the TeijinGroup’s ongoing efforts to review its management structure in line with the Teijin Group Reforms for Profitability
Improvement announced in February 2023. As part of these efforts, the two organizations were reorganized andintegrated into the New Business Development Unit as a measure to ensure future innovation through cross-functional
collaborations under corporate leadership. As such, for year on year comparisons, figures for FY2022 have beenrearranged according to the segment classification after the change.
28

In addition, starting from FY2023, the segments appear in the financial statements in a different order than before.

Segment operating results (sales and operating income) of the Teijin Group are as follows. (100 Millions of yen)

Fiscal 2022

Fiscal 2023

ChangePercentage

Net sales
Operating Income

High performance materials

2,748

2,628

△120

△4.4

Composites

1,638

1,769

+130

+8.0

Material
Fibers & Products
Converting
Healthcare

4,387

4,397

+10

+0.2

3,221

3,215

△6

△0.2

1,506

1,447

△59

△3.9

IT

580

721

+140

+24.2

Others

494

548

+55

+11.1

Total

10,188

10,328+140+1.4

Material
Fibers & Products
Converting

△213

△62

+151

-

97

121

+25

+25.4

Healthcare

252

73

△178

△70.9

IT

81

95

+14

+17.7

Others

△15

△8

+8

-

Elimination and Corporate

△73

△85

△13

-

Consolidated total

129

135

+7

+5.3

2) Overview of Each Business Segment
I. Materials Business Field
The Materials Business Field saw generally strong demand mainly in automobile related applications.
However, the business was impacted by reduced demand due to customer inventory adjustments regarding
products for some applications and an economic slowdown, and sales volume decreased mainly due the United
Auto Workers (UAW) strike in the composites business. On the other hand, factors that contributed to profits
included the desired effects of profitability improvement such as revised sales prices, the decline in raw material
and fuel prices, and insurance income.
Net sales were 439.7 billion yen, an increase of 1.0 billion yen (0.2%) year on year, while operating loss was 6.2
billion yen, an improvement of 15.1 billion yen year on year. EBITDA was 32.1 billion yen, an increase of 17.4 billion
yen year on year, while ROIC based on operating income was -2%.
In the aramid business, major product Twaron para-aramid fibers were negatively impacted by the increase in plant
1 fixed costs including a rise in unit labor costs, and a high level of inventory at the beginning of the fiscal year due
to a cost increase in the previous fiscal year. Meanwhile, factors contributing the increase in operating income were
the favorable effect of the revision of sales prices that had been implemented in response to the rise in raw material
and fuel prices in FY2022, the decline in natural gas prices, and insurance income for the fire accident at a raw material
plant in the third quarter of FY2022. On the other hand, sales volume decreased due to the negative impact of theplant fire that remained in the first part of the first half, procurement constraints for special repair parts for someproduction equipment, and inventory adjustments in supply chains for automobile and optical fiber applications. As aresult, the aramid business experienced a slight increase in net sales and an increase in operating income year on
year.
In the resin and plastics business, the sales volume of major product polycarbonate resin remained at the FY29

2022 level, mainly due to weak demand caused by the sluggish economy in China and the slowdown of the European
economy. In addition, operating income was impacted by lower sales prices due to a decline in raw material prices
and the deterioration of sales mix. As a result, the resin and plastics business experienced a decrease in net sales
and a slight decrease in operating income on a year on year.
In the carbon fibers business, although passenger demand recovered in aircraft applications, growth of demandfor carbon fibers slowed due to procurement constraints across supply chains, and the sales volume decreased mainly
due to inventory adjustment in supply chains for recreational and other applications. While the weaker yen and lower
raw material and fuel prices contributed to operating income, the carbon fibers business recorded a slight increase in
net sales and a decrease in operating income.
In the composites business, the revision of sales prices in response to the rise in raw material prices in the previous
year as well as cost reduction measures that had been implemented to improve profitability offset the decrease insales caused by declining demand in some programs in North America and the negative impact of the UAW strike. As
a result, the composites business achieved a year-on-year increase in both net sales and operating income.
Ⅱ. Fibers & Products Converting BusinessNet sales were 321.5 billion yen, a slight decrease of 0.6 billion yen (-0.2%) year on year, while operating income
was 12.1 billion yen, an increase of 2.5 billion yen (25.4%) year on year. EBITDA was 19.7 billion yen, an increase of
3.1 billion yen year on year, while ROIC based on operating income was 8%.
In the field of fiber materials and apparel, sales of textiles and apparel items for the North American and Chinese
markets remained strong, and apparel sales in Japan also remained robust as well. In the field of industrial materials,
sales of polyester staple fibers for water treatment filters, high-grade artificial leather and infrastructure reinforcement
materials remained strong, and automobile-related overseas business continued to be strong except for some
applications. While purchase costs increased due to higher fuel prices and weaker yen, the business implemented
measures to improve production efficiency and revised sales prices.
Ⅲ.Healthcare Business Field
The home healthcare equipment rental business remained strong, and the sales
volume of OSTABALO increased after restrictions on the administration period were lifted. Meanwhile, income
was affected by the payment of an extraordinary lump-sum pharmaceutical contract fee, a decline in the sales
volume of FEBURIC caused by the market entry of generic alternatives, and drug price revisions.
Net sales were 144.7 billion yen, a decrease of 5.9 billion yen (-3.9%) year on year, while operating income was
7.3 billion yen, a decrease of 17.8 billion yen (-70.9%) year on year. EBITDA was 33.3 billion yen, a decrease of 17.8
billion yen year on year, while ROIC based on operating income was 4%.
In the pharmaceutical business, the business entered into an exclusive licensing agreement in November 2023
with Ascendis Pharma A/S, regarding research, development, manufacturing and sales in Japan for three drugs
currently under development as hormone therapy drugs to be used for the treatment of rare endocrine diseases, andrecorded an extraordinary contract payment of US$70 million in R&D expenses. Furthermore, income was affectedby declining sales volume due to the market entry of generic alternatives to FEBURIC in June 2022, and the revisionof drug prices in April 2023, mainly for drugs that remained on the National Health Insurance drug price list long after
the expiration of patents. Meanwhile, the business has been conducting promotion activities for osteoporosis treatment
OSTABALO, which was launched in January 2023, and the sales volume increased after restrictions on theadministration period were lifted in December 2023. In addition, the sales volume of Somatuline*1 and Xeomin*2
increased steadily. Moreover, in March 2024, the business entered into a license agreement with Bioprojet to grant it
exclusive worldwide rights to develop, manufacture and sell an investigational candidate for narcolepsy, and thebusiness received an upfront cash payment of US$30 million.
*1. Somatuline®, a treatment for acromegaly, pituitary gigantism, neuroendocrine tumors, thyroid-stimulating
hormone secreting pituitary tumors, and gastrointestinal and pancreatic neuroendocrine tumors, is the registeredtrademark of Ipsen Pharma, France.
30

*2 Xeomin®, a treatment for upper and lower limb spasticity, is the registered trademark of Merz Pharma GmbH &Co. KGaA, Germany.
In the home healthcare field, as the number of examinations recovered gradually in the market for continuous
positive airway pressure (CPAP) therapy, the number of rented CPAP devices continued to grow (by approximately
7% from the end of the previous fiscal year), and the number of examinations and the number of new prescriptions
both reached a record high. On the other hand, in the home oxygen therapy (HOT) market, the number of rented HOT
devices slightly decreased as the increase of respiratory disease patients due to COVID-19 subsided. In terms of
new model development, the business launched Hi-Sanso Portable α III, a smaller and lighter portable oxygen concentrator,
in July 2023, and has been expanding sales activities.
Ⅳ. IT BusinessNet sales were 72.1 billion yen, an increase of 14.0 billion yen (24.2%) year on year, while operating income was
9.5 billion yen, an increase of 1.4 billion yen (17.7%) year on year. EBITDA was 10.6 billion yen, an increase of 1.8
billion yen year on year, while ROIC based on operating income was 66%.
In the Internet business field, sales remained strong as the business continued to make effective investments inadvertisements for e-comics services. In the IT service field, performance remained strong mainly in the businessfor hospitals.
Ⅴ. Other (including the battery materials business, the membrane business, the regenerative medicine business,and the orthopedic implantable devices business)
Net sales were 54.8 billion yen, an increase of 5.5 billion yen (11.1%) year on year, while operating loss was 0.8
billion yen, an improvement of 0.8 billion yen year on year.
In the battery materials business, sales of LIELSORT, a separator for lithium-ion batteries, remained strong, as in
FY2022. In addition, sales of MIRAIM, a high-performance membrane, increased in cutting edge semiconductor
applications.
In the orthopedic implantable devices business—which encompasses artificial joints and absorbable osteosynthesis
materials—sales volume remained strong as the number of surgeries gradually recovered after COVID-19 wasreclassified as a Class 5 infectious disease. Moreover, in July 2023, the business acquired an approval for production
and sales of SYNFOLIUM, a cardiovascular and vascular repair patch.
In the regenerative medicine business, Japan Tissue Engineering Co., Ltd., steadily increased sales in theregenerative medicine contract business and the research and development support business. As a result, both net
sales and operating income increased year on year. Moreover, the launch of the CDMO* business also progressed
steadily.
*Contract Development and Manufacturing Organization: An organization which undertakes the development andproduction of products under a contract.

3) Analysis of Assets, Liabilities and Net Assets
Total assets at the end of the current consolidated fiscal year increased by 8.6 billion yen from the end of theprevious consolidated fiscal year to 1,251.0 billion yen. Current assets increased by 10.2 billion yen from the end of
the previous consolidated fiscal year mainly due to changes in cash, deposits, accounts receivable, inventory, andother current assets, as well as the depreciation of the yen against major currencies. Fixed assets decreased by 1.6
billion yen from the end of the previous consolidated fiscal year. Major factors behind this included a decrease of
15.0 billion yen in the value of sales rights for type-2 diabetes treatments taken over from Takeda Pharmaceutical
Company Limited due to their amortization and a decrease of 13.9 billion yen in the value of investment securities
mainly due to their sale, despite an increase of 22.2 billion yen in tangible fixed assets mainly due to capital
investment exceeding depreciation and the depreciation of the yen against major currencies.
Liabilities decreased by 22.3 billion yen from the end of the previous consolidated fiscal year to 769.1 billion
yen. Interest-bearing debt decreased by 30.5 billion yen mainly due to the repayment of long-term borrowings.
Net assets increased by 30.8 billion yen from the end of the previous consolidated fiscal year to 481.9 billion yen.
This was mainly due to the increase in foreign currency translation adjustment accounts due to the depreciation of31

the 3 yen against major currencies and the recording of profit attributable to owners of the parent.
As a result, the debt-to-equity ratio was 1.1 and the equity ratio was 36.3%. (As of the end of the previous
consolidated fiscal year, the debt-to-equity ratio was 1.2 and the equity ratio was 34.2%.)
The conversion rates of balance sheets at the end of the current consolidated fiscal year are 151 yen / US dollar,
163 yen / euro, and 1.08 US dollars / euro (134 yen / US dollar, 146 yen / euro, 1.09 US dollars / euro at the end of
the previous consolidated fiscal year).

(2) Changes in Assets and Profit and Loss
(Millions of yen)

Net sales

Fiscal Period 155th Fiscal Period 156th Fiscal Period 157th Fiscal Period 158th Fiscal Period
FY2020
FY2021
FY2022
FY2023 (period(Ended Mar. 2021) (Ended Mar. 2022) (Ended Mar. 2023)
under review)(Ended Mar. 2024)
836,512926,054
1,018,751
1,032,773(Millions of yen)

Operating income(Millions of yen)

Ordinary income(Millions of yen)

Business

Profit attributable(Millions of yen)
to owners of parent
Net earnings per
(Yen)
share
Total assets(Millions of yen)

Net assets(Millions of yen)

54,931

44,20812,863

13,54253,65849,692

9,100

15,564△6,662

23,158△17,695

10,599△34.70120.58△92.0455.07

1,041,131

1,207,583

1,242,433

1,251,021

430,364

464,811451,084

481,933(3) Capital Investment
In fiscal year 2023, equipment investments totaling 66.9 billion yen were carried out primarily for the purpose of improving
productivity and enhancing capacity in the Composites Business.

(4) Financing
We procured borrowings from financial institutions. Interest-bearing liabilities decreased by 30.5 billion yen from the end of

FY2022 to 498.9 billion yen.

(5) Transfer, Absorption-Type Split, or Incorporation-Type Split of Business
The Company executed an incorporation-type company split to transfer the rights and obligations arising from its contractdevelopment and manufacturing organization (CDMO) business for regenerative medicines to TEIJIN REGENET CO.,LTD.,on August 1, 2023 as the effective date.

(6) Acquisition or Disposal of Shares, Other Equity Interest, or Stock Acquisition Rights, etc. of Other
companies
The Company transferred all of the shares of its consolidated subsidiary Teijin Automotive Technologies (Tangshan) Co., Ltd.
to Qingdao Keda Times Intelligent Equipment Co., Ltd., on December 28, 2023 as the effective date.

32

(7) Significant Subsidiaries(As of March 31, 2024)
Businesssegments

Business

Subsidiary

Headquarters
location

0.02 million

The

Teijin Aramid B.V.
AramidNetherlands
Teijin Corporation (Thailand)baht

Limited720 million

Teijin Polycarbonate China

Plastic

China

RMB

Teijin Chemicals Plastic

Processing Compounds Shanghai Ltd.

Teijin Carbon Europe GmbH

euro
2,367 million

ThailandResin and Ltd.

Capital stock

143 million

China

RMB
0.026 millio

Germany

n euroMaterials
CarbonTeijin Carbon America, Inc.

US$407.5

U.S.A.

millionFibersRenegade Materials
Corporation

US$71.6

U.S.A.

million
US$830Teijin Automotive Technologies NA

U.S.A.

millionHoldings Corp.

Composites Teijin Automotive Technologies
Portugal

7.2 million euroCzech

315 million Czech

Investment

Production and sales of para* 100.00
aramid fibers
Production and sales of aramid
100.00fibers and resin100.00 Production of polycarbonate resin100.00 Production of resin compound* 100.00

Fibers & Products

Czech s.r.o.

Republic

Teijin Frontier Co., Ltd.

Osaka

Nantong Teijin Co., Ltd.

koruna¥2,000
million
287 million

China

RMB

Converting
Teijin Polyester (Thailand) Limited

548 million

Thailandbaht
J.H. Ziegler GmbH1.02 million

Germany

euro

Teijin Pharma Limited¥10,000Tokyo

million

Production and sales of carbon
fibers
Production and sales of carbon* 100.00
fibers
Production

and

sales

of

* 100.00 intermediate material (prepreg) forcomposite materials* 100.00* 100.00

Portugal, S.A.
Teijin Automotive Technologies

Principal businessratio (%)

* 100.00

Production and sales of composite
products
Production and sales of composite
products
Production and sales of composite
products
Production and sales of textiles and100.00others
Production and sales of polyester* 100.00
textile goods
Production and sales of polyester* 67.61
fibers* 100.00

Production and sales of unwoven
fabrics
Production

and100.00 pharmaceuticals

sales
and

of
home

healthcare equipment

Healthcare

Sales and rental of pharmaceuticals
Teijin Healthcare Limited¥100 million

Tokyo

and home healthcare equipment,* 100.00
etc.,

and

provision

healthcare service

33

of

home

IT

Infocom Corporation
Amutus Corporation¥1,590Tokyo

million¥150 million

Tokyo

Development and sales of computer
57.86
software, etc.
* 57.86 Internet business
Development, manufacturing,¥4,959Japan Tissue Engineering
Aichi

Other

millionCo., Ltd.

sales, and custom
57.72 development/manufacturing forregenerative medical products andrelated products

Teijin Lielsort Korea Co.,South Korea

29,096
million KRW

Ltd.

Production and sales of lithium-ion
100.00battery separators

Note 1: The Teijin Group has 98 consolidated companies including the aforementioned 20 significant subsidiaries; 63 companies
are accounted for by the equity method.
Note 2: * indicates the investment ratio including investment by subsidiaries.

(8) Management Policy and Tasks Ahead
1) Corporate Vision
Around 100 years since its founding, the Group has built a business foundation by anticipating the needs of society, throughexpansion into new business fields and by tackling challenges. In recent years, the Group has been implementing
restructuring initiatives to navigate a difficult business situation and making investments for future growth, but it has notbeen able to achieve a level of growth that meets market expectations. As a result, medium- to long-term growth expectations
continue to decline.
In light of this, the Teijin Group has established the Group’s purpose, “Pioneering solutions together for a healthy planet”
based on the recognition that the Group needs to create an organization under shared values in order to enhance its ability
to return to a growth path as “One Teijin.”

In the “Journey to One Teijin” project to clarify and verbalize this purpose,

we fostered empathy among employees both in Japan and abroad by focusing on employee participation and the process ofvisualization. As a result, the purpose which the Group has established reflects employees’ strong desire to become acompany that strives to provide solutions by going back to the roots of Teijin so that people will be able to continue enjoying
life on this beautiful planet throughout the future.
Based on this purpose, the Teijin Group will put into practice the three value statements that have been formulated alongwith the purpose, i.e., “ⅰ) Respect all challenges,” “ⅱ) Grow with diverse members by leveraging their expertise,” and “ⅲ)
Be considerate of the planet and all living beings and protect them,” and aim to achieve the long-term vision of becoming a“Company that Supports the Society of the Future.” Specifically, the Group will provide value to society with the aim of
becoming a “company that prioritizes the health of the planet, protects the global environment, and supports a circularsociety” in the mobility, infrastructure and industry fields, and become a “company that addresses the issues of patients,
families and communities in need of more support” in the healthcare field, mainly in the field of rare and intractable diseases.

342) Issues to Be Addressed(i) Medium-Term Management Plan
The Company announced the “Teijin Group Medium-Term Management Plan 2024-2025” in May 2024.
Issues to be addressed by the Company are ⅰ) Recovering fundamental earning power by completing the profitability
improvement measures, ⅱ) Implementing business portfolio reforms, and ⅲ) Strengthening the global management base.
The Company will promote the medium-term management plan with strong determination by positioning the plan as afirst step to address these issues and to return to growth trajectory.
i) Recovering earning power by completing the profitability improvement measures:
The Company looked at FY2023 as a year to implement reforms to improve its profitability, and focused on thefollowing initiatives.
(a) Improve profitability in the composites, aramid and healthcare businesses(b) Review the management structure to promote the acceleration of management decisions and execution
As a result of these initiatives, in FY2023, the Company mostly achieved the improvement target of 30 billion yen or
more.
On the other hand, as shown in the figure below, there were still issues in the stabilization of production, the Company
will focus on initiatives to achieve the stabilization of global production by FY2025 with the support of corporate
functions, and recover its fundamental earning power while implementing various measures to improve profitability,with the aim to achieve 50 billion yen in adjusted operating income, 4% or above in ROIC*1, and 6% or above in ROE*2.
*1 ROIC = Adjusted operating income after tax / Average*3 of invested capital (Invested capital = Equity + Interest-bearing
dept)*2 ROE = Profit attributable to owners of parent / Average*3 of equity attributable to owners of parent*3 Average: ([Beginning balance + Ending balance] / 2)35

＜Gist of Profitability Improvement and Measures for Completing Eeforms＞ii) Implementing business portfolio reforms
In order to achieve growth through reformed business portfolio during the period of the next medium-term
management plan for FY2026 onwards, the Company will execute strategic options for underperforming and less focusedbusinesses and narrow down businesses it operates as part of the current medium-term management plan. In addition,
the Company will carefully examine and make investment in the fields of mobility, infrastructure and industrial, andhealthcare, where we believe we have a competitive advantage, so that we can transform the Company from a materialoriented business to a value-oriented business, such as functional material business, processing/solution-based business,and business based on the service platform cultivated in the home healthcare business, in the growth industry sector.
<The Process of Change>*1 IFRS results of FY2023 are approximate*2 ROIC = Adjusted operating income after tax / Average* of invested capital (Invested capital= Equity + Interest-bearing dept )*3 Adjusted operating income is calculated by adding equity on gain and losses of unconsolidated
subsidies and affiliates to operating income, excluding gain and losses due to extraordinary factors*4 ROE = Profit attributable to owners of parent / Average* of equity attributable to owners ofparent *Average: ([Beginning balance + Ending balance] / 2)
*5 D/E ratio taking into account the equity credit of the subordinated bonds (The Company issued
subordinated bonds of ¥60.0 billion on July 21, 2021.)

36

Furthermore, under the capital allocation and shareholder returns policy for the two years of FY2024 and FY2025, theCompany will give priority to allocate cash gained by strengthening the existing businesses’ ability to generate cash
through the improvement of profitability to infrastructure investment and dividends. The Company will also give priority
to allocate cash generated from disposal of cross-held shares and unutilized assets as well as execution strategic options
for underperforming and less focused businesses to growth investment and additional shareholder returns (including
purchase of treasury shares).
<Capital Allocation and Shareholders Return Policy (FY2024-2025)>iii) Strengthening the global management base
In line with business portfolio reforms, the Company will strengthen its global management base, and strive toenhance the ability to execute based on its purpose. In the medium-term management plan, the Company will workon “corporate governance system optimized for global/diversified companies” from the perspective of governance,“evolution of facility/operation/maintenance though integration of knowledge/technology in and outside Japan” fromthe perspectives of production, manufacturing and technology, and “ensuring that the right people are assigned to theright positions in order to implement the strategies” from the perspective of human capital.

37

<Roadmap to Enhanced Global Management Basis>

By steadily executing management strategies and business strategies in the medium-term management plan as describedabove, the Company will achieve sustainable growth and enhance medium- to long-term corporate value to meet the
expectations of stakeholders including investors, with an aim of achieving 10% or above in ROE and 1x or above in PBR at
an early stage.
(ii) Concept and Actions Related to Sustainability
・Actions related to sustainability
The Group recognizes issues surrounding sustainability including social and environmental issues as management issues,and it has analyzed opportunities and risks for the Company and identified materiality (material issues). The Company strives
to achieve its long-term vision by setting KPIs and implementing various actions for each issue.
The Company’s sustainability policy and materiality are matters to be resolved by the Board of Directors, and the status ofsuch matters is reported by CEO or Chief Sustainability Officer, as appropriate, to the Board of Directors for discussion.
For environment-related issues, the Company has set the long-term KPIs listed in the table below. For in-house CO2
emissions, the Company is working on achieving net zero by developing a roadmap to achieve long-term goals.
＜Sustainability Efforts；Key KPI＞

38

In addition, in terms of measures related to human capital, the Company will work toward achieving the goals by setting
indicators for diversity and engagement of executives and managers to assess the progress of “measures to enable employees
to thrive.”
Specifically, as “KPIs for diversity,” the Company has set targets as follows: 30% female officers ratio in April 2030
(October 2023・actual: 12%, April 2026・milestone: 20%), 30% non-Japanese officers ratio in April 2030 ( October 2023・
actual: 8%, April 2026・milestone: 10%), 30% female managers (female department general managers and section managers)
ratio in April 2030 (October 2023・actual: 10%, April 2026・milestone: 12%). In addition, the Company has set a target for
the engagement score of 68 in April 2030 (September 2023・actual; 62, April 2026・ milestone: 64) as a “KPI for engagement
survey.”Note) Officers: Directors, Statutory Auditors, and Corporate Officers

3) Social Contribution Activities
The Teijin Group, in accordance with its basic policies for social contribution, will value harmony with nature andachieve growth with local communities. To this end, the Group is conducting appropriate social contribution activities as agood corporate citizen, in line with its business attributes and respecting the local uniqueness of each area in which we
operate. To provide support to the development of younger generations in the fields of academia/education and sports, wehave supported a total of nearly 1,700 students specializing in science and engineering fields through the Teijin Kumura
Scholarship provided by the Teijin Scholarship Foundation for about 70 years. Moreover, we are supporting young people’s
sports activities by co-sponsoring the All Japan High School Soccer Tournament as well as supporting the Children’s Rights
in Sport Principles announced by the Japan Committee for UNICEF. The Company is also running various other programson an ongoing basis, including reconstruction support for the affected areas of the 2024 Noto Peninsula Earthquake, theleave of absence system to support employees’ volunteer activities, and employee participation programs, etc.

39(9) Principal Businesses(As of March 31, 2024)
Business

Business area
AramidMaterials

Para-aramid fibers, Meta-aramid fibers

Resin and Plastic
Processing

Polycarbonate resin, Polycarbonate sheets & films,
PET/PEN/PBN resin, PPS resin, frame-retardant

Carbon Fibers

Carbon fibers, oxidized PAN fibers,intermediate materials (Prepreg, etc.)

Composites

Automotive composite products

Textiles andApparelYarns, textiles, apparel products, general merchandise

Fibers & Products
Converting
Industrial Textiles
and Materials

Pharmaceuticals
Healthcare
Home Healthcare

Business solution
IT
Digitalentertainment

Other

Principal products and businesses

Othercarbon fiber

Polyester fiber materials, nonwoven fabrics, automotive
materials, industrial materials, civil engineering andconstruction materials, tents and heavy cloths, resin, films,
living and interior products, healthcare products
Prescription Drugs: Type 2 diabetes treatments, treatment
for osteoporosis, treatment for hyperuricemia and gout,sustained-release expectorant, agent for infection,transdermal analgesic anti-inflammatory, treatment for
acromegaly and pituitary gigantism, botulinum toxin type A
Home Healthcare Services: Oxygen Concentrator for Home
Oxygen Therapy (HOT), Continuous Positive Airway
Pressure (CPAP) Unit, Bilevel Positive Airway Pressure
Unit, Ultrasound Bone Fracture Treatment Device
Information system for general companies, information
system for hospitals, information services for nursing careproviders
e-comics distribution services
Lithium-ion
battery
separators,
high-performancemembrane, Implantable medical devices such as artificial
joints and bioresorbable osteosynthesis materials,
regenerative medicine, functional food ingredients, rawmaterials for pharmaceuticals and functional foods, and feed
compositions, etc.

Note: PET (Polyethylene terephthalate), PEN (Polyethylene naphthalate), PBN (Polybutylene naphthalate), PPS (Polyphenylene
sulfide)40

(10) Principal Business Locations, etc.

(As of March 31, 2024)
Business

Function

Location

The Company

Headquarters

Osaka, Tokyo

Production
bases

Ehime, Yamaguchi
The Netherlands, Thailand
Tokyo, Osaka

AramidResin and Plastic
Processing
Materials
Carbon Fibers

Composites
Materials

Operationbases

Researchbases

Ehime, Yamaguchi

Production
bases

Hiroshima, Ehime

Operation
bases

Tokyo, Osaka, Aichi

Researchbases

Tokyo, Chiba, Ehime

Production
bases

Shizuoka, Gifu

Operation
bases

Tokyo

Researchbases

Shizuoka

Production
bases

Ehime, Gifu

Operation
bases

Tokyo

Research
bases

Ehime

Production
bases
Fibers & Products
Converting

Healthcare

The Netherlands, Germany, India, Thailand, China, U.S.A.,
Mexico, Brazil

Operation
bases

The Netherlands, Germany, China

Thailand, China

The Netherlands, Malaysia, Thailand, China, Taiwan, U.S.A.

Thailand, China

Germany, Vietnam, U.S.A.

Germany, Singapore, Vietnam, China, Taiwan, U.S.A.

Germany, U.S.A.

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

U.S.A., Mexico, Portugal, Czech Republic

U.S.A., France, Germany
Ehime, Ishikawa, Fukui, Niigata, Gifu, Shiga, Hyogo,
Yamaguchi, Shimane, Fukuoka
China, Thailand, Vietnam, Germany, Hungary
Osaka, Tokyo, Aichi, Niigata, Fukui
U.S.A., Germany, China, Thailand, Vietnam, Myanmar,
Indonesia, Mexico, India, Taiwan, Philippines, Bangladesh

Research
bases

Ehime

Production
bases

Yamaguchi

China, Thailand

China
41

Operationbases

18 branches and 124 sales offices throughout JapanTokyo, Yamaguchi

Researchbases

U.S.A.

Operation
bases

IT

Other

Tokyo, Osaka

Production
bases

Ehime, Yamaguchi, Aichi, Okayama, Hyogo

Operation
bases

Tokyo, Osaka, Aichi, Okayama, Hyogo

Researchbases

Tokyo, Chiba, Aichi, Okayama, Ehime, Yamaguchi, Hyogo

South Korea

South Korea

The Netherlands

Note: The function of headquarters is indicated in the Company, and the manufacturing, operation and research bases are indicatedin each business segment.

（11）Employees
Change in the number of
employees

157th Fiscal Period

158th Fiscal Period(As of March 31, 2023)(As of March 31, 2024)

Materials

10,708名

10,051名△657名

Fibers & Products
Converting
Healthcare

5,576

5,607

+31

2,990

2,835

△155

IT

748

902

+154

Other

2,462

2,439

△23

Total

22,484

21,834△650

Business segments

Note:1: The number of employees mentioned above refers to the employment personnel in each business segment.
Note 2 : The above employee count does not include temporary employees (2,015 in the 157th period and 1,983 in the158th period).
Note:3 :Starting from the 158th period, due to the new business organization, the comparative information for the 157th period
has been reclassified using the post-change segment divisions.

(12) Principal Lenders and Amount of Borrowings(As of March 31, 2024)
Principal lenders

Balance of borrowings (millions of yen)

MUFG Bank, Ltd.

79,544

Mizuho Bank, Ltd.

33,573

Japan Bank for International Cooperation

27,254Note 1: The balance of borrowings includes borrowings from overseas local subsidiary banks.
Note 2: In addition to the above, as a principal borrowing, there is a balance of 122,750 million yen borrowed through syndicatedloans.

42

2. 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, and in order to fulfill our responsibilities to various other stakeholders, we are striving to strengthen corporate
governance. The basic elements of corporate governance include the aim of improving transparency, ensuring fairness,accelerating decision-making, and ensuring the independence of monitoring and supervision. We are working to establish
and strengthen an effective corporate governance system through an “corporate officer system and board of directors
including independent outside directors”, “statutory auditor system including independent outside statutory auditors”, and ”“Nomination Advisory Committee and Compensation Advisory Committee in which independent outside directors
constitute the majority,”<Corporate Governance Structure>(As of March 31, 2024)(1) Reasons for Choosing the Current Corporate Governance System
At the Teijin Group, the corporate governance system will be the one that appears to be optimal for achieving theCompany's objectives at the time. Therefore, it will be reviewed as appropriate according to changes in the current social
and legal environment.
In accordance with the current Companies Act, the Board of Directors is required to properly function in terms of both
important business decisions/decision-making and the monitoring and supervision of management. We have determinedthat a governance system centered on the two wheels of business execution led by the internal directors, and management
oversight and supervision functions that the outside directors emphasize and the oversight and auditing functions of the
Statutory Auditors and the Board of Statutory Auditors, is appropriate. We will continue to be a company with a boardof statutory auditors for the time being. In addition to the fact that the statutory auditors comprising the board of statutory
auditors are independent and can exercise their authority independently, the Company has granted the Board of Corporate
Auditors and Corporate Auditors “full monitoring authority for the Board of Directors” and seeks “active andconstructive opinions at the Board of Directors,” so that the Board of Corporate Auditors continues to have a more43effective auditing function for the Board of Directors. As a result, corporate governance similar to the strengthening ofmonitoring and supervision functions that is aimed for by a company with a nominating committee, etc., will be
substantially achieved at the Company through the Board of Directors including Independent Outside Directors and thecorporate officer system, the system of Statutory Auditors including Independent Outside Statutory Auditors, theNomination Advisory Committee and Compensation Advisory Committee, and the Advisory Board, etc.
(2) Outline of Current System
1) Board of Directors
The Board of Directors meets and decides or approves important matters such as the management policy and overallplan of the entire Teijin Group, in addition to the matters stipulated in laws and regulations and the Articles of Incorporation,and supervises the execution of duties by Directors.
To expedite decision making and clarify accountability of execution of business, the Company’s Articles ofIncorporation set the maximum number of the Members of the Board at 10, and the Company has introduced a corporate
officer system that delegates broad authority to corporate officers. As of March 31, 2024, the Board of Directors of theCompany comprises eight (8) members. There are four (4) Outside Directors who satisfy all the requirements ofIndependent Director as stipulated by the Company, one of whom is a female director. The Articles of Incorporation set
the term of office for directors at one year.
The chair of the Board of Directors is selected from the Outside Directors as part of separation of monitoring andsupervision from business execution.
2) Nomination Advisory Committee and Compensation Advisory Committee as consultative bodies
The Nomination Advisory Committee and the Compensation Advisory Committee are established as consultative bodies
to the Board of Directors in order to further improve the transparency of executive personnel affairs. Each Committee has
functions to deliberate on the following matters and make proposals and recommendations to the Board of Directors.
a) Nomination Advisory Committeei) Replacing the CEO and nomination of a successorii) Selection and retirement of the Representative Director candidateiii) Selection and retirement of Director candidate (including the Chairperson of the Board)iv) Selection and retirement of Statutory Auditor candidatev) Matters concerning promotion/demotion and appointment/retirement of Internal Directors and management
executivesvi) Matters concerning independence standards for Outside Director and Independent Outside Statutory Auditorvii) Selection of CEO successor candidates, and review of CEO training plans for successor candidates and its progressby CEOb) Compensation Advisory Committeei) Matters concerning the compensation system for Teijin Group officersii) Matters concerning the compensation level of Teijin Group officersiii) Matters concerning performance evaluation and compensation of Internal Directors (including CEO) andmanagement executives

44

Both Advisory Committees are made up of four (4) Outside Directors, the Chairperson of the Board (vacant if absent)
and the CEO. The Outside Director who is the chairperson of the Advisory Committee chairs the respective Advisory
Committees. In principle, for matters concerning the CEO, the CEO leaves the room and does not participate in thediscussions. For matters concerning the Chairperson of the Board as well, the Chairperson of the Board leaves the roomand does not participate in the discussions.
3) Advisory Board
The Advisory Board has been set up with the aim of improving management transparency through the advice of external
experts, and is positioned and operated as a consultative body to the Board of Directors. The Advisory Board deliberates
on the following matters and advises the Board of Directors.
a) Matters concerning the company's business plans and strategic direction (including long-term and medium-termplans)b) Matters concerning corporate governance, CSR, corporate ethics, etc.
c) Matters concerning company performanced) Matters concerning domestic and foreign politics, economy, and legal systeme) Other matters related to overall management
The Advisory Board is made up of five (5) to seven (7) outside advisors (currently composed of four (4) Outside Directors
and two (2) non-Japanese experts), the Chairperson of the Board (vacant if absent) and the CEO. The Outside Director who
is the chair of the Board of Directors chairs the Advisory Board.
4) Board of Statutory Auditors
The Company’s Statutory Auditors have expertise and experience in law, finance, accounting, etc., and audit theperformance of duties by the Directors. The Company’s Board of Statutory Auditors consists of five members, and three ofthem, who make up a majority, are Independent Outside Statutory Auditors (including one female member), who satisfy all
the requirements of Independent Statutory Auditor stipulated by the Company. In order to enhance the effectiveness ofGroup-wide oversight, the Committee of Teijin Group Statutory Auditors, which comprises the statutory auditors of Group
companies and other members, is held regularly. The Teijin Group Auditors Office, which is under the direct control of fulltime Statutory Auditors, has been established as an organization to assist the duties of Statutory Auditors, and as of March
31, 2024, five (5) full-time staff members have been assigned.

5) Internal audit system
The Corporate Audit Department, which reports directly to the CEO, has been established as an internal audit
organization, and carries out Group-wide and global audits to evaluate the efficiency and validity of internal control
functions. Furthermore, at certain listed subsidiaries and so forth, individual internal audit organizations have been
established. As of March 31, 2024, the number of internal auditors in the Teijin Group totaled 18 (excluding internal auditors
at listed subsidiaries and so forth).

6) Status of accounting audits
The status of certified public accountants who executed auditing is as follows (items in brackets indicate the affiliatedauditing firms and the number of consecutive years performing audits).
Hidetoshi Fukuda (KPMG AZSA LLC, 5 years), Yoshihiro Uehara (KPMG AZSA LLC, 3 years)
45

Hiroaki Iwasaki (KPMG AZSA LLC, 3 years)
The status of assistants who executed auditing is as follows.
Certified Public Accountants 10, others 37, for a total of 47.
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 on and decides the basic policy and annual plan related to TRM proposed by the TRM Committee.
At the same time, the Board of 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, supervision and monitoring regarding TRM.
The details of the Teijin Group’s “Corporate Governance Guide” (the Company’s Corporate Governance System) canbe viewed on the Company’s website: (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 FY2023 and an
outline of the results are as follows.
1) Analysis and Evaluation Methoda) A self-evaluation questionnaire survey was conducted of all Directors and Statutory Auditors (13 including Outside
Directors and Outside Statutory Auditors), referencing advice from external experts. In addition, interviews wereconducted for certain Directors and Statutory Auditors (in total 7 persons) by external experts based on the selfevaluation 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 beaddressed, and improvement measures.
b) The evaluation points in the questionnaire were compiled from the following ten fields. Respondents evaluated 66
topics on a five-point scale and made comments (including any additional comments field).
i) The Board of Directors as a wholeii) Compositioniii) Prior arrangements, etc.
iv) Operationv) Deliberationvi) Nomination Advisory Committeevii) Compensation Advisory Committeeviii) Statutory Auditorsix) Self evaluation
46x) Other2) Summary of Results of the Board of Directors Effectiveness Evaluationa) Summary
The results of the Board of Directors Effectiveness Evaluation conducted in line with 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 functioning properly as a whole and ensuring effectiveness.
b) Status of response to issues recognized in or before FY2023
i) Discussions on business portfolio
At the Board of Directors meetings held in FY2023, through discussions on the newly announced mid-term
management plan in May 2024, we confirmed our commitment to thorough business portfolio management and areview of existing businesses. Additionally, we aim for growth centered around key industrial sectors. In themedium to long term, we plan to transform our business approach from traditional material-centric to value-driven
business development leveraging service foundations cultivated in functional materials, processing and solutionoriented businesses, and home healthcare. To address increasingly complex customer needs, we will hone ourability to combine different technologies and functions and align with customer requirements. We also reaffirmed
our commitment to ongoing discussions and progress monitoring related to the new mid-term management plan.
ii) Discussion on the allocation of management resources to human capital, etc. based on i) above
At the Board of Directors meetings held in FY2023, the course of direction and initiatives related to humancapital investments were reported. Furthermore, in discussions on the new medium-term management plan, it was
decided to develop a human resource strategy built on the main pillars of “establishing ‘right place’ and securing‘right people’ to implement strategies” and “measures to enable employees to thrive,” and to implement specificaction plans based on this strategy.
We confirmed that discussions will continue in line with the new medium-term management plan.
iii) Discussions on the status of usage of data and digital technology and policies on initiatives therefor based on i)At the Board of Directors meetings held in FY2023, a report was made on the development of DX humanresources through discussions on the new medium-term management plan. It was confirmed that, as a priority
measure to create innovation, the Company will actively implement DX promotion activities using digital and IT
technologies, and that discussions on this topic will continue.
iv) Discussion on BCP including supply chain
In the fiscal year 2023 board of directors meeting, the TRM Committee chaired by the CEO provided regular
reports to the board of directors regarding ‘strategic risks’ and ‘operational risks.’ These reports highlighted theimplementation of business-specific and customer-centric BCP/BCM measures. Furthermore, to enhance BCP
readiness, ongoing discussions are planned to continue.
v) Discussion on rationality of parent-subsidiary listing
At the Board of Directors meetings held in FY2023, the rationality of maintaining the listing of Infocom
Corporation and Japan Tissue Engineering Co., Ltd. (J-TEC), which are listed subsidiaries of the Company, wasdiscussed as part of the discussion on the new medium-term management plan. From the standpoint of optimizing
the corporate value of Infocom Corporation and J-TEC, and not just the Group itself, we decided it was rational tomaintain their listing. It is necessary to regularly confirm the listing of the parent company and its subsidiaries. At
the Board of Directors meetings in FY2024, we plan to continue discussing the rationality of maintaining listings
on the stock exchange.
473) Issues Recognized in the Board of Directors Effectiveness Evaluation in FY2023 and Initiatives Going Forward
Factoring in the effectiveness evaluation implemented in FY2023, the Board of Directors has discussed and decided
to further advance its efforts to address the following issues in FY2024.
a) Confirmation of the progress of the medium- to long-term management plan, and reconsideration of relevant
strategies as neededb) Discussion on the sustainability strategyc) Discussion on the DX strategyd) Discussion on human capitale) Measures to further enhance the effectiveness of the Board of Directorsf) Discussion on rationality of parent-subsidiary listing
The Company aims to increase the effectiveness of the Board of Directors and further strengthen corporate
governance through these measures.

3.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 and promoting
business alliances with them.
Each year, the Board of Directors reviews whether or not it is appropriate to hold shares based on an examination of theholding purpose and rationality 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 significance froma management strategy standpoint and business relationships, in addition to comparing dividends, transaction amounts, andother quantitative impacts against the cost of capital.
After these reviews, regarding the results of the verification, we have proceeded with the sale of a total of 11 stocks (5full stock sales and 6 partial stock sales) during the current fiscal year. The total sale price amounted to 24.1 billion yen.
The Company will continue discussions with companies the shares of which the Company currently hold, and in principle,
will endeavor to sell all of shares of listed companies.
In addition, whenever the shareholders of cross-shareholdings indicate their intention, such as intention to dispose of
their shares, the Company handles the matter appropriately without interfering with disposal of such shares.
(Note) The selling price is the amount of listed shares sold by the Company(non-consolidated basis).
(2) Standards for the Exercise of Voting Rights Related to Cross-Shareholdings
In exercising voting rights related to shares that the Company has decided to hold, the Company confirms each proposal
from the perspective of increasing corporate value and shareholder value over the medium to long term and determines
whether to vote for or against. For proposals that may have a significant impact on the corporate value of the investee
companies, the Company collects and examines information with particular attention paid.

48

(Note) The ratio to the standalone balance sheet amount and consolidated net assets of our company.

4. Matters Regarding the Shares of the Company (as of March 31, 2024)(1) Total number of authorized shares 600,000,000 shares(2) Total number of issued shares(3) Number of shareholders

197,953,707 shares
90,017(4) Top 10 shareholders of the Company
Investment in the Company
Shareholders

Number ofshares held

1

The Master Trust Bank of Japan, Ltd. (Trust account)2

Custody Bank of Japan, Ltd. (Trust account)

3

BNYMSANV AS AGENT/CLIENTS LUX UCITS NON
TREATY 1

4 BNY GCM CLIENT ACCOUNT JPRD AC ISG (FE-AC)
5
6

Nippon Life Insurance Company
The Employee Stock Ownership Association of Teijin

7

Oasis Japan Strategic Fund Ltd.

8MUFG Bank, Ltd.

NORTHERN TRUST GLOBAL SERVICES SE,
9 LUXEMBOURG RE LUDU RE:UCITS CLIENTS 15.315
PCT NON TREATY ACCOUNT
10STATE STREET BANK AND TRUST COMPANY 505223

Shareholding
ratio (%)

35,045,300

18.20

11,410,440

5.92

8,260,400

4.28

8,029,761

4.17

7,045,501

3.65

6,769,131

3.51

4,800,410

2.49

2,897,287

1.50

2,857,000

1.48

2,663,276

1.38

Note 1: The shareholding ratio has been calculated after excluding treasury stocks (5,400,915 shares) from the issued shares.
Note 2: Shareholding ratios are truncated to two decimal places.

49(5) Status of shares issued as compensation to company officers during FY2023
Restricted Stock (RS)The details of the stock compensation issued during FY2023 are as follows.
Category
Internal Directors who

Class and number of shares

Number of persons

Ordinary shares of the Company

4concurrently serve as Corporate

25,235 shares

Officers
Note: The above stock compensation was not granted to the Internal Directors who do not concurrently serve as
Corporate Officers, Outside Directors and Statutory Auditors.

5. Matters Regarding Stock Acquisition Rights of the Company(1) Overview of stock acquisition rights as a stock compensation-type stock option
1) Number of stock acquisition rights
The maximum number of stock acquisition rights to be allocated to directors during a period of one (1) year starting
the day after the annual Ordinary General Meeting of Shareholders is held shall be set at 200.
2) Amount to be paid in for the stock acquisition rights
The fair value of the stock acquisition rights shall be calculated using the closing price on the allotment date based on
the Black-Scholes model.
3) Number of shares to be issued upon exercise of the stock acquisition rights
The number of shares to be issued upon exercise of one stock acquisition right (hereinafter the “number of shares tobe granted”) shall be 200 shares. However, if the Company conducts a stock split or stock consolidation (reverse stock
split), or if there are other unavoidable reasons that require some adjustment, such adjustment shall be reasonably made.
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, and the amount of money to be paid in upon exercise of the stock acquisition rights shall be the said amount multipliedby 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 share transfer is approved at a General Meeting of Shareholders of the Company, the Company can acquire stockacquisition rights without consideration.
8) Main conditions for exercising stock acquisition rights
Holders of stock acquisition rights may exercise stock acquisition rights for only five (5) years from the date of lossof position as a Director of the Company, its subsidiary and/or affiliate.
9) Other details pertaining to stock acquisition rights (including other matters from those in 1) through 8) above)
Shall be determined by resolution of the Board of Directors.

50

(2) Summary of stock acquisition rights as a stock option as of the last day of FY2023 as consideration for the performanceof duties
Number of issuance(Issuance date)
11th stock acquisitionrights(March 15, 2013)
12th stock acquisitionrights(March 14, 2014)
13th stock acquisitionrights(March 18, 2015)
14th stock acquisitionrights(March 16, 2016)
15th stock acquisitionrights(March 17, 2017)
16th stock acquisitionrights(March 16, 2018)
17th stock acquisitionrights(March 18, 2019)18th stock acquisitionrights(March 16, 2020)
19th stock acquisitionrights(March 15, 2021)

Number of stock Class and number of Issuance priceacquisition rights
target shares(Per share)

Exercise price(Per share)

Exercise period

698

Ordinary shares
139,600 shares

¥980

¥1

From March 15, 2013
to March 14, 2033

618

Ordinary shares
123,600 shares¥1,140¥1

From March 14, 2014
to March 13, 2034

379

Ordinary shares
75,800 shares¥1,925¥1

From March 18, 2015
to March 17, 2035

274

Ordinary shares
54,800 shares¥1,800¥1

From March 16, 2016
to March 15, 2036

287

Ordinary shares
57,400 shares¥1,955¥1

From March 17, 2017
to March 16, 2037

294

Ordinary shares
58,800 shares¥1,732¥1

From March 16, 2018
to March 15, 2038

321

Ordinary shares
64,200 shares¥1,627¥1

From March 18, 2019
to March 17, 2039

266

Ordinary shares
53,200 shares¥1,138¥1

From March 16, 2020
to March 15, 2040

394

Ordinary shares
78,800 shares¥1,725¥1

From March 15, 2021
to March 14, 2041

The total number of unexercised stock acquisition rights of the aforementioned stock acquisition rights held by Directors
and Statutory Auditors of the Company(As of March 31, 2024)

Director

Statutory Auditor
Number of
Number of units statutory auditors
holding rights
7
1

15th stock acquisition rights

7

Number of
directors holding
rights1

16th stock acquisition rights

24

3

8

1

17th stock acquisition rights

30

3

10

1

18th stock acquisition rights

32

4

8

1

19th stock acquisition rights

52

4

-

-

Number of issuance

Number of units

Note 1: Stock acquisition rights are not granted to Outside Directors and Statutory Auditors.
Note 2: The stock acquisition rights held by Statutory Auditors were granted as consideration for their execution of duties as
Corporate Officers prior to being appointed to the position of Statutory Auditors.

51

6. Matters Regarding Directors and Statutory Auditors(1) Directors and Statutory Auditors(As of March 31, 2024)
Position

Name

President and Representative
Akimoto Uchikawa
Director
SeniorExecutive
Officer,
Representative Director of the Eiji Ogawa
Board
Director, Senior Executive
Naohiko Moriyama
Officer*Director, Executive Officer

Noboru Yamanishi

Director

Yoichi Suzuki

Director

Masaru Onishi

Director

Masaaki Tsuya*Director

Tamie Minami

Full-time Statutory Auditor

Masanori Shimai

Full-time Statutory Auditor

Akio Nakaishi

Statutory Auditor

Hitomi Nakayama

Statutory Auditor

Jun Arima*Statutory Auditor

Koichi Tsuji

Duty, state of significant positions
concurrently held at othercompaniesCEO
CFO (Chief Financial Officer)
Responsible for the Procurementand Logistics Division
Chief Officer, Corporate Strategy
Director, Infocom Corporation
Chief Sustainability Officer
Responsible for Engineering
Division and the Corporate Audit
Department
Outside Director, KAJIMACORPORATION
Outside Director, Mitsui O.S.K.
Lines, Ltd.
Outside Director, Kadoya Sesame
Mills Incorporated
Outside Director, Benesse
Holdings, Inc.
External Advisor, Bridgestone
Corporation
Outside Director, Santen
Pharmaceutical Co., Ltd.

Participation in the Board of
Directors and Board of Statutory
Auditors Meetings
The Board of Directors 13/13(100%)The Board of Directors 13/13(100%)The Board of Directors 13/13(100%)The Board of Directors 10/10(100%)The Board of Directors 13/13(100%)The Board of Directors 13/13(100%)The Board of Directors 13/13(100%)The Board of Directors 10/10(100%)The Board of Directors 12/13(92%)
The Board of Statutory Auditors
12/12 (100%)
Statutory Auditor, Infocom
The Board of Directors 13/13
Corporation(100%)The Board of Statutory Auditors
12/12 (100%)Partner lawyer, KASUMIGASEKI- The Board of Directors 13/13
SOGO LAW OFFICES(100%)
Outside Director, ROYAL
The Board of Statutory Auditors
HOLDINGS Co., Ltd.
12/12 (100%)
Outside Statutory Auditor, JAPANPOST Co., Ltd.
Project Professor, Graduate School The Board of Directors 13/13
of Public Policy, University of(100%)Tokyo
The Board of Statutory Auditors
12/12 (100%)
The Board of Directors 10/10
Outside Director, Mitsubishi UFJ(100%)
Financial Group, Inc.
The Board of Statutory Auditors
Outside Director, Maruichi Steel
9/9 (100%)
Tube Ltd.

Note 1: The Directors and Statutory Auditor marked with * were newly elected at the 157th Ordinary General Meeting of
Shareholders held on June 21, 2023.
Note 2: Of the directors, Yoichi Suzuki, Masaru Onishi, Masaaki Tsuya and Tamie Minami are Outside Directors. The
Company requires a candidate for Outside Director to satisfy the requirements of “Independent Director” stipulated by
the Company. The aforementioned four (4) Directors satisfied all such requirements and maintained their independence
throughout the relevant fiscal year. Since they also satisfy the requirements of independence as stipulated by the Tokyo

52

Stock Exchange, they were registered by the Company as “Independent Director” at the said stock exchange. The
contents of the requirements of “Independent Director” stipulated by the Company can be viewed at the Company’s
website: (https://www.teijin.com/ir/management/governance/requirements/)
Note 3: Three (3) Statutory Auditors— Hitomi Nakayama, Jun Arima, and Koichi Tsuji— are Independent Outside Statutory
Auditors. The Company requires a candidate for Independent Outside Statutory Auditor to satisfy the requirements of“Independent Statutory Auditor” stipulated by the Company. The aforementioned three (3) Statutory Auditors
satisfied all such requirements and maintained their independence throughout the relevant fiscal year. Since they alsosatisfy the requirements of independence as stipulated by the Tokyo Stock Exchange, they were registered by theCompany as “Independent Auditor” at the said stock exchange. The contents of the requirements of “Independent
Statutory Auditor” stipulated by the Company can be viewed at the Company’s website:(https://www.teijin.com/ir/management/governance/requirements/).
Note 4: Full-time Statutory Auditor Masanori Shimai and Statutory Auditor Koichi Tsuji have extensive knowledge of financeand accounting as described below:
・Full-time Statutory Auditor Masanori Shimai has been involved in finance and accounting-related work for many
years at the finance and accounting-related department of the Company.
・Statutory Auditor Koichi Tsuji is qualified as a Certified Public Accountant.
Note 5: Statutory Auditor Hitomi Nakayama is qualified as a lawyer and has ample knowledge of compliance and risk
management.
Note 6: The following Directors and Statutory Auditor retired as of June 21, 2023 upon expiration of their term of office.
Director Jun Suzuki
Director Akihisa Nabeshima
Director Toshiya Koyama
Director Yukako Uchinaga
Statutory Auditor Gen Ikegami
Note 7: Changes in posts and duties of Directors during FY2023 are as follows.

Name
Jun Suzuki

Akihisa Nabeshima

Toshiya Koyama

Eiji Ogawa

Naohiko Moriyama

Noboru Yamanishi

New post
Senior Advisor and Member ofthe Board
Mission Executive and Memberof the Board
Assistant to President

Former post
Chairperson of the Board

Senior Executive Officer,
Representative Director of the
Board
Chief Financial Officer
Mission Executive and Member Director, Executive Officerof the Board
Chief Social Responsibility
Assistant to Chief Sustainability Officer
Officer (responsible for Safety
Responsible for Corporate
Promotion Project)
Audit Department
Senior Executive Officer,
Director, Executive Officer
Representative Director of the
President, Material Business ofBoard
Teijin Group
CFO (Chief Financial Officer)
Responsible for theProcurement and Logistics
Division
Director, Senior Executive
Director, Executive Officer
Officer
Chief Officer, Corporate
Chief Officer, Corporate
Strategy
Strategy
Executive Officer, Teijin Group Corporate Officer, Teijin Group
Chief Sustainability Officer
General Manager, Resin andResponsible for Engineering
Plastic Processing Business
53

Date of transfer
April 1, 2023

April 1, 2023

April 1, 2023

April 1, 2023

April 1, 2023

April 1, 2023

Division and Corporate Audit
Department
Director, Executive Officer
Chief Sustainability Officer
Responsible for Engineering
Division and Corporate Audit
Department

Unit
Executive Officer, Teijin Group
Chief Sustainability Officer
Responsible for the Engineering
June 21, 2023
Division and the Corporate
Audit Department

Note 8: Changes in posts and duties of Directors since April 2024 are as follows.

Name

NoboruYamanishi

New post
Director, Executive Officer
Chief
Sustainability
Officer
Responsible
fortheEngineering Division

Former post
Date of transfer
Director, Executive Officer
Chief
Sustainability
Officer
Responsible
forthe April 1, 2024
Engineering Divisionand the Corporate Audit
Department(2) Limited Liability Agreements
The Company has executed a Liabilities Limitation Agreement with each of four (4) Directors, Yoichi Suzuki, Masaru Onishi,
Masaaki Tsuya and Tamie Minami, and each of five (5) Statutory Auditors, Masanori Shimai, Akio Nakaishi, Hitomi Nakayama,
Jun Arima and Koichi Tsuji, 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) Directors and Officers Liability Insurance (D&O insurance)
The Company has concluded a liability insurance contract with an insurance company for its directors, etc. as stipulated in Article 430-3,
Paragraph 1 of the Companies Act. The scope of the insured parties under the insurance contract includes Directors, Statutory Auditors andCorporate Officers of the Company and Directors and Statutory Auditors of Teijin Pharma Limited. Under said insurance contract, the legally
mandated amount of indemnification and litigation expenses caused by the performance or omission of the insured’s duties, will be covered.
However, claims for damages caused deliberately or through gross negligence will not be covered. Note that the full amount of the insurance
premiums is shouldered by the Company and Teijin Pharma Limited.

(4) Compensation, etc. for Directors and Statutory Auditors
1) Method of Determining the Policy for Establishing the Content of Compensation, etc., for Individual Directors, andOverview of the Policy
The outline of the content of the decision policy regarding the content of individual compensation, etc. of our Directors is
as follows. Note that the said decision policy is decided by a resolution of the Board of Directors after deliberation by theCompensation Advisory Committee.
The activities of the committee, etc. for deliberations and decisions regarding remuneration of Directors in FY2023
are as follows.
The Board of Directors met four (4) times and the Compensation Advisory Committee met eight (8) timesa) Basic policy for compensation systemsi) The system should enhance awareness of contributing to a medium- to long-term increase in earnings andcorporate valueii) The system should be closely linked to company performance, and be highly transparent and objectiveiii) The system should be primarily focused on enhancing value shared with the interests of stakeholders and54

shareholder-focused management awarenessiv) The system should maintain sufficient compensation levels and content to act as an incentive to secure highquality management human resourcesb) Compensation level
The compensation level for Internal Directors and Outside Directors is determined each year after verifying theappropriateness of the level of total compensation for each position and job grade based on the results of a
remuneration survey conducted among major corporations in Japan where the globalization of executives is
progressing.
c) Composition of compensation, etc. for directors and statutory auditorsi) Compensation for Internal Directors who concurrently serve as Corporate Officers is composed of fixed basic
compensation (cash) that is not linked with the performance of the Company and Restricted Stock (medium- tolong-term incentive compensation), as well as variable performance-based compensation (cash) (short-term
incentive compensation) and Performance Share Units (medium- to long-term incentive compensation), with theaim of providing an incentive to achieve short-term performance goals, achieve the medium-term management
plan, and improve medium- to long-term corporate value.
For Internal Directors who do not concurrently serve as Corporate Officers, only cash compensation is granted
based on their appointed duties, and Restricted Stock (medium- to long-term incentive compensation) andPerformance Share Units (medium- to long-term incentive compensation) are not granted.
ii) Compensation for Outside Directors and Statutory Auditors is solely basic compensation that is not linked to theperformance of the Company.
d) Composition ratio of compensation
The composition ratio of compensation for Internal Directors who concurrently serve as Corporate Officers is asfollows.
Position

President andRepresentative
Director
Other Directors

Fixed compensation

Variable compensation
Performance
Share Units (PSU)

Total
compensation

Basic
remuneration(Cash)

Restricted
Stock (RS)

Performancebased
compensation(Cash)

45%

10%

20%

25%

100%

50%

10%

25%

15%

100%

e) Performance indicators for variable compensationi) Performance-based compensation (cash)
In FY2023, to ensure that the Company returns to growth for the future as promoted in the “Teijin Group Reforms
for Profitability Improvement,” we have set “consolidated ROE,” “operating income” and “individual performancetargets” (including in-house Group CO2 emissions, lost time injury frequency rate, Diversity & Inclusion andemployee satisfaction as common non-financial targets for officers) as performance indicators for performance-based
compensation (cash).
For targets and results, etc. of FY2023 performance indicators, please refer to 5) a).

55

ii) Performance Share Units (PSU)
To motivate directors to realize an improvement in corporate value and shareholder value in the medium- to longterm, the Company employed “consolidated ROE,” “consolidated ROIC based on operating income” and “TSR” asperformance indicators for Performance Share Units (PSU) in FY2023. The targets for “consolidated ROE” and“consolidated ROIC based on operating income” are figures the Company should aim for over the medium-term. The
Company continued to employ “TSR” as a performance indicator to build awareness among management from theperspective of the stakeholders.
For targets and results, etc. of FY2023 performance indicators, please refer to 5) b).
f) Policy on determining the timing and conditions for providing compensation, etc.
i) Fixed compensation:
・Basic compensation (cash)
The amount paid to each Director is determined according to their position and job grade and paid as a fixedamount. One twelfth of the fixed amount based on position and job grade is provided as monthly compensation.
・Restricted Stock (RS)With the maximum annual amount of ¥70 million (maximum annual number of shares is 50,000), around Julyor August of each year, a certain number of shares determined based on position and job grade will be allottedwith transfer restrictions and other conditions within the scope of approval determined via a resolution of theGeneral Meeting of Shareholders.
Restricted Stock (RS) will be allotted to each Internal Director who concurrently serves as a Corporate Officer
on the condition that there has been no certain violation of rules stipulated by the Board of Directors of theCompany, and that the Internal Director meets other requirements determined necessary for Restricted Stock planby the Board of Directors of the Company.
ii) Variable compensation:・Performance-based compensation (cash)
Performance-based compensation (cash) is calculated based on position and job grade, the achievement levelof the performance indicators, and the individual performance evaluation of Directors, and paid out by the endof June as a year-end lump sum.
Additionally, new performance evaluation periods and performance evaluation indicators, etc. will be
subsequently set within the scope that has received approval via a resolution of the General Meeting of
Shareholders.
・Performance Share Units (PSU)
With the maximum annual amount of ¥300 million (maximum annual number of shares is 200,000), around
July or August of each year, the number of shares calculated based on the achievement level of one or more
performance indicators set by the Board of Directors applicable to performance evaluation periods comprised of
one or more fiscal years will be allotted after conclusion of the performance evaluation period set for eachperformance indicator, with transfer restrictions and other conditions within the scope of approval determined
via a resolution of the General Meeting of Shareholders. Additionally, following the conclusion of the initial
performance evaluation period, new performance evaluation periods and performance indicators, etc. will be
subsequently set within the scope that has received approval via a resolution of the General Meeting of
Shareholders.
56Performance Share Units (PSU) will be allotted to each Internal Director who concurrently serves as a
Corporate Officer on the condition that the Internal Director has served in a position designated by the Company’s
Board of Directors for the entirety or a portion of the performance evaluation period, there has been no certain
violation of rules stipulated by the Board of Directors of the Company; and the Internal Director meets otherrequirements determined necessary for Performance Share Units by the Board of Directors of the Company.
g) Matters regarding delegation of determining compensation, etc. for individual directors
No applicable matters.
h) Other significant matters regarding determining the content of individual compensation, etc.
Compensation for Directors shall be decided after being deliberated by the Compensation Advisory Committee, being
proposed to the Board of Directors and after full consideration of the proposal by the Board of Directors.
2) Reasons the Board of Directors Determined the Content of Compensation, etc., for Individual Directors for FY2023 werein Conformity with the Decision Policy
In determining the content of remuneration for individual Directors, the Compensation Advisory Committee considered
the matter including the alignment with the decision policy regarding the original draft of the proposal before submitting itto the Board of Directors and then the Board of Directors then gave full consideration and resolved the said proposal.
Consequently, the Board of Directors determined that the content is in conformity with the decision policy.
3) Resolutions of General Meeting of Shareholders Regarding Compensation, etc. for Directors and Statutory Auditors
The amount of monetary compensation, etc. for Directors of the Company shall be ¥630 million or less per year (of which
100 million yen or less per year is for Outside Directors), and the total maximum amount of compensation, etc. for granting
Restricted Stock (RS) shall be ¥70 million per year (maximum annual number of shares is 50,000). For the allotment of
Performance Share Units (PSU), the total maximum annual amount shall be ¥300 million (maximum annual number ofshares is 200,000). These amounts of compensation were resolved by 155th Ordinary General Meeting of Shareholders heldon June 23, 2021. As of the conclusion of the said Ordinary General Meeting of Shareholders, the number of Directors
totaled 10 (including four Outside Directors).
At the 133rd Ordinary General Meeting of Shareholders held on June 25, 1999, it was resolved that the maximum amountof compensation for Statutory Auditors of the Company shall be ¥12 million per month. The number of Statutory Auditors
after the conclusion the said Ordinary General Meeting of Shareholder totaled five.
4) Remuneration for Directors and Statutory Auditors for FY2023(persons; millions of yen)
Total amount ofcompensation,etc.

Total amount of compensation, etc., by type
Basic
PerformanceRestricted
Performancecompensation
based
Stock (RS)Share Units(cash)
compensation(PSU)(cash)
184
28
35－(Note 1)
(Note 2)
(Note 3)

Directors(Excluding Outside
Directors)
Outside Directors

248

72

72

Statutory Auditors(Note 5)76

76－
(Note 4)－57－
(Note 4)－－(Note 4)－

Number ofapplicableofficers7
52

(Excluding Outside
Statutory Auditors)
Outside Statutory
Auditors (Note 5)

41

41

－

－

－

4

Note 1: Performance-based compensation (cash) of ¥28 million is an estimated amount to be paid by the end of June 2024
to the four (4) Internal Directors who were appointed at the 157th Ordinary General Meeting of Shareholders heldon June 21, 2023, and two (2) of the three (3) Outside Directors who retired upon the conclusion of the said General
Meeting of the Shareholders.
Regarding Performance-based compensation (cash) to be provided to the four Internal Directors appointed at the157th Ordinary General Meeting of Shareholders held on June 21, 2023, considering that there were offers forpartial decline of the acceptance (reduction) (totaling ¥24 million for all of four Directors) of Performance-based
compensation (cash) from all of four Internal Directors due to the financial situation in FY2023 and after the
deliberation of Compensation Advisory Committee, it was calculated by reducing the offered amount. The total
amount of compensation of ¥248 million and Performance-based compensation (cash) of ¥28 million as indicatedin the table above do not include the reduced amount.
Note 2: Restricted Stock (RS) of ¥35 million is the amount of compensation for granting Restricted Stock (RS) in July
2023 to four (4) Internal Directors appointed at the 157th Ordinary General Meeting of Shareholders held on June21, 2023.
Note 3: Since the targets for FY2023 were not achieved for performance indicators indicated in 5) b), there is nocompensation amount for granting Performance Share Units (PSU).
Note 4: Performance-based compensation(cash), Restricted Stock (RS) and Performance Share Units (PSU) were notgranted to Outside Directors.
Note 5: Compensation for Statutory Auditors is determined through discussions among Statutory Auditors.

5) Matters Regarding Performance-based Compensation, etc.
a) Performance-based compensation (cash)
After selecting the indicators stated in 1) e) i) as performance indicators, the amount of performance-based
compensation for each Internal Director was calculated based on the achievement level etc. of the target, and theperformance evaluation of individual Directors.
The results against the performance indicators for FY2023 showed that consolidated ROE and operating income
were below the standard targets as shown in the table below. Consequently, the payment rate of Performance-based
compensation (cash) in FY2023 is expected to be 35% of the standard amount (the amount to be paid when all standard
targets are achieved for each performance indicator) of Performance-based compensation (cash).
As stated in Note 1 of 4), regarding Performance-based compensation (cash) to be provided to the four Internal
Directors appointed at the 157th Ordinary General Meeting of Shareholders held on June 21, 2023, and two (2) of thethree (3) Internal Directors who retired at the same shareholders’ meeting, there were offers for partial decline of theacceptance (reduction) (totaling ¥24 million for all of four Directors) of Performance-based compensation (cash) fromall of four Internal Directors. Consequently, Performance-based compensation (cash) for these four Directors wascalculated by reducing the offered amount. The payment rate for Performance-based compensation (cash) before thereduction is 64%, but it is expected to be 35% after the reduction measure.
Performance indicators
Consolidated ROEStandard targets (Note 2)
3%
58

Results
2.4%

Operating income¥35 billion¥13.5 billion

The Company has set individual
performance targets including nonIndividual performance financial indicators (in-house Grouptargets
CO₂ emissions, lost time injury
frequency rate, Diversity & Inclusion,
employee satisfaction).

Based on performance
evaluation ofindividual Directors

Note2: The standard targets for consolidated ROE and operating income are figures in the earnings forecast asof the beginning of the fiscal year (announced in May 2023).
b) Performance Share Units (PSU)
Ⅰ. Details of performance indicators and reasons for the selection
As described in 1) e) ii).
Ⅱ. The amount or calculation method of Performance Share Units
The Company calculated the number of shares to be granted to each Internal Director concurrently serving as
Corporate Officer based on the achievement level of the targets for performance indicators stated in 1) e) ii).
Ⅲ. Results for performance indicators
The results against the performance indicators for FY2023 fell short of the standard targets for FY2023 as shownin the table below. As a result, Performance Share Units (PSU) were not granted for the duties executed during
the performance evaluation period.
Performance indicators

Targets

Results

Consolidated ROE
Consolidated ROIC basedon consolidated operating
income10% or above

2.4%

8% or above

1.6%

The Company’s TSR >=Benchmark TSR

Targetunachieved

TSR

Performance
evaluation
periodOne year

Note: The standard targets for “consolidated ROE” and “consolidated ROIC based on consolidated operating
income” are figures the Company should aim for over the medium-term.
6) Matters Regarding Non-monetary Compensation, etc.
a) Restricted Stock (RS)The details of the stock compensation issued during FY2023 are as follows.

Category
Internal Directors who
concurrently serve as Corporate

Class and number of shares

Number of persons

Ordinary shares of the Company

425,235 shares

Officers
Note: The above stock compensation was not granted to the Internal Directors who do not concurrently serve as
Corporate Officers, Outside Directors and Statutory Auditors.
Outline of the conditions attached when the shares were allotted is as described in 1) f) i).
b) Performance Share Units (PSU)
As described in 5) b).
59

7) Revision of the Restricted Stock Plan and Performance Share Units Plan and Review of Performance Indicators in
FY2024
If the Revision of the Restricted Stock Plan and Performance Share Units Plan for Directors, in Line With the Revisionof the Compensation System for Executive Officers (revised plans are hereinafter referred to as the “New Plan” ) in
Proposal 3 on Proposals of the Notice of Convocation is approved as originally proposed, the outline for the decision
policy for compensation, etc. for individual directors will be changed as follows.
(changes are underlined):a) Basic policy for compensation plani) The plan should incentivize the achievement of short-term and medium- to long-term management targets, andenhance awareness of contributing to a medium- to long-term increase in earnings and corporate valueii) The plan should be closely linked to company performance, and be highly transparent and objectiveiii) The plan should be primarily focused on enhancing value shared with the interests of stakeholders andshareholder-focused management awarenessiv) The plan should maintain sufficient compensation levels and content to act as an incentive to globally securehigh-quality management human resourcesb) Compensation level
The compensation level for Internal Directors and Outside Directors is determined each year after verifying theappropriateness of the level of total compensation for each position and job grade based on the results of a
remuneration survey in which major corporations in Japan participate.

c) Composition of compensation, etc. for directors and statutory auditorsi) Compensation for Internal Directors who concurrently serve as Corporate Officers is composed of fixed basic
compensation that is not linked with the performance of the Company, variable performance-based compensation(short-term incentive compensation), Restricted Stock (medium- to long-term incentive compensation), andPerformance Share Units (medium- to long-term incentive compensation), with the aim of providing an incentive
to achieve short-term performance goals and the medium-term management plan, and improve medium- to longterm corporate value.
For Internal Directors who do not concurrently serve as Corporate Officers, only cash compensation is granted
based on their appointed duties, and Restricted Stock (medium- to long-term incentive compensation) andPerformance Share Units (medium- to long-term incentive compensation) are not granted.
ii) Compensation for Outside Directors and Statutory Auditors is solely basic compensation that is not linked to theperformance of the Company.

d) Composition ratio of compensation
The composition ratio of compensation for Internal Directors who concurrently serve as Corporate Officers is asfollows.
Position

Fixedcompensation
Basic
compensation

Variable compensation
Performancebased
compensation
60

Restricted Stock

Total
compensation
Performance
Share Units

President andRepresentative
Director
Other directors

45%

20%

10%

25%

100%

50%

25%

10%

15%

100%

* Under the New Plan, as stated in c) i) above, Restricted Stock (medium- to long-term incentive compensation) is consideredvariable compensation as the asset value of compensation fluctuates with share price fluctuations. The composition ratio ofcompensation will remain the same.

e) Performance indicators for performance-based compensation etc.
i) Performance-based compensation
To incentivize the recovery of the fundamental earning power and the promotion of business reforms, the Company
has set “business income,” “ROIC based on business income after tax,” and “individual performance targets”
including non-financial indicators (safety) for sustainability that are applied to all directors as performance indicatorsfor each Internal Director concurrently serving as Corporate Officer.

ii) Performance Share Units
To motivate Directors to realize an improvement in corporate value and shareholder value in the medium to longterm, the Company employs “ROE,” “TSR,” and “Sustainability” as performance indicators. The target for “ROE”
is the figure the Company should aim for over the medium term. The Company continues to employ “TSR” as aperformance indicator to build awareness among management from the perspective of the shareholders. In addition,in order for the Company to achieve its long-term vision of becoming a “Company that Supports the Society of the
Future,” the Company has also set non-financial indicators for sustainability (environment, DE&I, and employee
engagement) as performance indicators for each Internal Director concurrently serving as Corporate Officer.

f) Policy on determining the timing and conditions for providing compensation, etc.
i) Fixed compensation:
・Basic compensation
The amount paid to each Director is determined according to their position and job grade and paid as a fixedamount. One twelfth of the fixed amount based on position and job grade is provided as monthly compensation.
ii) Variable compensation:・Performance-based compensation
Performance-based compensation (cash) is calculated based on position and job grade, the achievement levelof the performance indicators, and the individual performance evaluation of Directors, and paid out by the endof June as a year-end lump sum. Furthermore, within the scope approved by the resolution of the General Meetingof Shareholders, new performance evaluation periods and performance evaluation indicators will be established.
・Restricted StockAround July or August of each year, shares and share units equivalent to the standard amount determined basedon position and job grade will be allotted with transfer restrictions and other conditions within the scope ofapproval determined via a resolution of the General Meeting of Shareholders. As a general rule, the transfer
restrictions on granted shares are lifted upon retirement from a position designated in advance by the Board of
Directors. Regarding monetary compensation based on stock units, it is typically provided in cash by multiplying
the number of granted stock units by the market price of the Company’s common share at the time of transfer
restriction removal. The upper limit shall be ¥35 million (25,000 shares) per fiscal year for the stock portion and¥35 million per fiscal year for the share units portion, and the total maximum amount of cash to be paid based on
the share units shall be ¥35 million per fiscal year.
61

Restricted Stock (RS) will be allotted to each Internal Director who concurrently serves as a Corporate Officer
on the condition that there has been no certain violation of rules stipulated by the Board of Directors of theCompany, and that the Internal Director meets other requirements determined necessary for the restricted stockplan stipulated by the Board of Directors of the Company.
・Performance Share Units
Around July or August of each year, the number of shares and share units calculated based on the achievementlevel of one or more performance indicators set by the Board of Directors applicable to the performance
evaluation periods comprised of one or more fiscal years will be allotted after conclusion of the evaluation
performance period set for each performance indicator, with transfer restrictions and other conditions within thescope of approval determined via a resolution of the General Meeting of Shareholders. As a general rule, thetransfer restrictions on granted shares are lifted upon retirement from a position designated in advance by the
Board of Directors. Regarding monetary compensation based on stock units, it is typically provided bymultiplying the number of granted stock units by the market price of the Company’s common shares at the timeof transfer restriction removal.

The upper limit shall be ¥150 million (100,000 shares) per fiscal year for thestock portion and ¥150 million per fiscal year for the share units portion, and the total maximum amount of cash
to be paid based on the share units shall be ¥150 million per fiscal year. For performance indicators andperformance evaluation period for the initial target period, please refer to Table 1 below.

Performance Share Units will be allotted to each Internal Director who concurrently serves as a Corporate
Officer on the condition that the Internal Director has served in a position designated by the Company’s Boardof Directors for the entirety or a portion of the performance evaluation period, there has been no certain violationof rules stipulated by the Board of Directors of the Company and the Internal Director who meets otherrequirements determined necessary for the performance share units plan by the Board of Directors of theCompany.

Table 1the performance evaluation criteria and evaluation period for Performance Share Units

TargetComposition
ratio(For one (1)year)

Performance
evaluation
periodTiming of share allotment ofshares and share units

ROE

10%

40%

One year

Annually

TSR

BenchmarkTSR

30%

Sustainability(Environment, DE&I
and employee
engagement)

Medium-termtarget30%

Two years

The year following the final
year of the medium-term
management plan (Thenumber of shares and share
units to be allotted for the
performance evaluation
period is calculated in a lumpsum by multiplying thenumber of years in theperformance evaluation
period during the process of
calculating the number of

Performanceindicators

62

shares and share units to be
allotted)

However, all of the contents above are those planned as of the start of the New Plan, and the contents (including
performance indicators, targets, performance evaluation period, composition ratio, etc.) are subject to change by
the decision of the Board of Directors during the initial target period within the scope that has received approval
via a resolution of the General Meeting of Shareholders. Furthermore, new standards will be established after theend of the initial target period.
g) Matters regarding delegation of determining compensation, etc. for individual directors
No applicable matters.
h) Other significant matters regarding determining the content of individual compensation, etc.
Compensation for members of the Board of Directors shall be decided after being deliberated by the Compensation
Advisory Committee, being proposed to the Board of Directors and after full consideration of the proposal by the
Board of Directors.

7. Matters Concerning the Outside Directors and the Outside Statutory Auditors(1) Status of Significant Concurrent Positions (As of March 31, 2024)
Category
Name
Significant Concurrent Positions

OutsideDirector

Yoichi Suzuki

Outside Director, KAJIMA CORPORATION

Masaru Onishi

Outside Director, Mitsui O.S.K. Lines, Ltd.
Outside Director, Kadoya Sesame Mills Incorporated
Outside Director, Benesse Holdings, Inc.

Masaaki Tsuya

External Advisor, Bridgestone Corporation

Tamie Minami

Outside Director, Santen Pharmaceutical Co., Ltd.

Hitomi Nakayama

Partner lawyer, KASUMIGASEKI-SOGO LAWOFFICES
Outside Director, ROYAL HOLDINGS Co., Ltd.
Outside Statutory Auditor, JAPAN POST Co., Ltd.

Jun Arima

Project Professor, Graduate School of Public Policy,
University of Tokyo

Koichi Tsuji

Outside Director, Mitsubishi UFJ Financial Group, Inc.
Outside Director, Maruichi Steel Tube Ltd.

OutsideStatutory
Auditors

Note: There are no important interests between the Company and any of the entities at which the above mentioned Outside
Directors and Outside Statutory Auditors hold positions as director/statutory auditor, etc.
(2) Main Activities in FY2023

63

CategoryOutside Director

Summary of advice given and duties performed as expectedof outside directors

Participation in
the Board of
Directors andBoard of
Statutory
Auditors
Meetings

・He offered valuable comments based on his expertise andknowledge of international economic and trade issues, etc.
cultivated over many years as a diplomat at appropriate
opportunities as well as at the Board of Directors meetings.
・As the Chairperson of the Compensation Advisory
Committee, he made appropriate statements regarding
reform of the compensation system and evaluation of theperformance of the CEO and Directors, etc.
・As a member of the Nomination Advisory Committee,
made useful comments on the selection of candidates for
Directors and executive officers, the human resources
system for officers, and the plan to develop CEO successor
candidates.
・As a member of the Advisory Board, gave insightful advice
on matters related to overall management.

The Board of
Directors
13/13 (100%)

MasaruOnishi・He offered valuable comments from his extensive
management experience and knowledge at appropriate
opportunities as well as at the Board of Directors meetings.
・He served as Chairperson of the Board of Directors as partof separation of monitoring/supervision and execution. Hevitalized the Board of Directors of the Company andendeavored to secure effectiveness and improve function of
the Board.
・As the chairperson of the Advisory Board, gave insightfuladvice on matters related to overall management.
・As a member of the Nomination Advisory Committee,
made useful comments on the selection of candidates for
Directors and executive officers, the human resources
system for officers, and the plan to develop CEO successor
candidates.
・As a member of the Compensation Advisory Committee,
made appropriate statements regarding reform of thecompensation system and evaluation of the performance of
the CEO and Directors, etc.

The Board of
Directors
13/13 (100%)

MasaakiTsuya

・He offered valuable comments from his extensive
management experience and knowledge at appropriate
opportunities as well as at the Board of Directors meetings.
・As the chairperson of the Nomination Advisory
Committee, made useful comments on the selection ofcandidates for Directors and executive officers, the humanresources system for officers, and the plan to develop CEO
successor candidates.
・As a member of the Compensation Advisory Committee,
made appropriate statements regarding reform of thecompensation system and evaluation of the performance of
the CEO and Directors, etc.
・As a member of the Advisory Board, gave insightful advice
on matters related to overall management.

The Board of
Directors
13/13 (100%)

Name

YoichiSuzuki64

・Made valuable comments based on her extensive experienceand knowledge gained in a global company in the Board of
Directors meetings and other appropriate opportunities.
・As a member of the Nomination Advisory Committee, madeuseful comments on the selection of candidates for Directors
The Board ofand executive officers, the human resources system for
Tamie Minami
Directors
officers, and the plan to develop CEO successor candidates.
10/10 (100%)
・As a member of the Compensation Advisory Committee,
made appropriate statements regarding reform of thecompensation system, etc.
・As a member of the Advisory Board, gave insightful advice
on matters related to overall management.
Outside Statutory Auditors

The Board of
Hitomi
Nakayama

She offered valuable comments from her professional
knowledge as lawyer, and offered, in particular, advice andsuggestions concerning compliance and risk management.

Directors 13/13(100%)The Board of
Statutory Auditors
12/12 (100%)
The Board of

Jun Arima

He offered valuable advice and suggestions on theenvironmental management that the Company has aimed for,including maintaining and improving compliance.

Directors 13/13(100%)The Board of
Statutory Auditors
12/12 (100%)
The Board of
Directors 10/10

He offered professional opinions as a certified public accountant
Koichi Tsuji as well as beneficial statements and suggestions on matters suchas portfolio reforms and risk management.

(100%)The Board of
Statutory Auditors
9/9 (100%)65

8. Matters Concerning the Accounting Auditors(1) Name of the accounting auditor
KPMG AZSA LLC(2) The amount of compensation (Millions of yen)

Details

Amount1) The amount of compensation the Company should pay the accounting auditor

1892) The total amount of monetary or other economic benefit to be paid by the Company
and its subsidiaries to the accounting auditor

332

Note 1: The amount of remuneration in 1) is the total amount since, in the audit contract between the Company and theaccounting auditor, there is no clear division between the amount of compensation for audits under the Companies
Act and the amount of compensation stated under the Financial Instruments and Exchange Act.
Note 2: 14 companies, including Teijin Aramid B.V., among the Company’s significant subsidiaries were audited by auditing
firms other than the accounting auditor.
Note 3: The Board of Statutory Auditors, taking into account the scale and attributes of the Company, confirmed and examinedthe content of the accounting auditor’s audit plans, the accounting auditor’s execution of duties and the basis for its
calculation of compensation estimates. Consequently, in accordance with Article 399, Paragraph 1 of the Companies
Act, the Board of Statutory Auditors consented to the compensation for the accounting auditor.

(3) Decision policy for the dismissal or non-reappointment of the accounting auditor
It is the policy of the Board of Statutory Auditors that it will dismiss an accounting auditor in accordance with the consent
of all Statutory Auditors when the accounting auditor is found to fall under any of the items in Article 340, Paragraph 1 of
the Companies Act.
Also, in addition to the above, the Board of Statutory Auditors will determine the details of any proposal for dismissal
to be submitted to the General Meeting of Shareholders if it is recognized that a situation has arisen at the accounting
auditor that triggers a serious hinderance to the auditing work of the Company, or the details of any proposal for nonreappointment to be submitted to the General Meeting of Shareholders if it is recognized that Company needs to change
the accounting auditor given the independence, credibility or execution of duties, etc. on the part of the accounting auditor.

9. Summary of a System to Secure Proper Operations and the Status of Use of Said System(1) Resolutions on Basic Systems for Internal Control
The Company adopted the “Resolutions on Basic Systems for Internal Control” at the Board of Directors meeting heldon March 29, 2024. The content of the resolutions is posted on the Company’s website(https://www.teijin.com/ir/management/governance/resolution/). A summary is as follows.
1) Systems for Ensuring the Compliance with Laws and the Articles of Incorporation in the Performance of Duties byDirectors, Officers and Employees of the Company and its Subsidiaries
The Company has established basic principles for compliance in the Teijin Group’s Corporate Governance Guide.
To practice these basic principles, the Company shall establish systems and organizational structures that ensure
practical operation and observation of the Teijin Group’s Corporate Philosophy, Corporate Code of Conduct, Regulations
for Teijin Group Corporate Ethics and other related internal regulations.
The representative directors, other executive directors and corporate officers shall take the initiative and set good66

examples in observing laws, the Articles of Incorporation, social rules and ethics, and shall promote complianceawareness among directors, officers and employees of Teijin and its subsidiaries. In order to supervise the entire TeijinGroup’s compliance and identify and address any potential issues, the Company appoints a Chief Sustainability Officer as
the officer in charge of compliance.
The directors, officers and employees of the Company and its subsidiaries shall be required to report to a Teijin entity
or to the holding company, i.e. Teijin Limited, any significant violations of laws or other serious information concerningcompliance, in accordance with Regulations for Teijin Group Corporate Ethics and others. Chief Sustainability Officer
shall direct and supervise investigations to confirm such facts and, upon consultation with CEO, determine appropriate
measures.
The Company shall provide necessary means for directors, officers, employees and business partners to directly reportany violation or suspicion of non-compliance in the Company or its subsidiaries. The Company shall establish andoperate a reporting and consultation hotline. The anonymity of the caller shall be protected, and any repercussions to thecaller shall be prevented. Important reports as well as measures taken by the relevant Teijin entity and their results shallbe announced as appropriate to, and shall be recognized by, all directors, officers and employees of the Company and its
subsidiaries.
The directors of the Company and its subsidiaries shall receive audits of their performance of duties by statutory
auditors and will respect any advice or recommendations received from the statutory auditors.
The Company has established the Corporate Audit Department, directly supervised by the CEO, to perform internal
auditing of the Teijin Group’s business operations and conduct evaluation of the internal control system and propose its
improvement.
The Teijin Group 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. The Chief
Sustainability Officer is appointed as the person in charge of dealing with antisocial forces. The Chief Sustainability
Officer, in cooperation with the Chief Human Resources Officer, shall establish response policies, etc., and thoroughly
inform directors, officers and employees of the Company and its subsidiaries.
At least four independent outside directors shall be appointed as members of the Board of Directors in order to further
ensure the validity of the decisions made by the Board of Directors in principle. These outside directors must satisfy therequirements for independence set forth by Teijin.
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 (TRM) system to deal with every riskthat may threaten the mission of achieving sustainable business development of the Teijin Group.
The TRM Committee (Refer to aforementioned “2(2)7) . Total Risk Management”) shall mainly deal with both the
Teijin Group’s operational risks and strategic risks, and shall propose basic policies and annual plans related to TRM to
the Company’s Board of Directors. The Chief Sustainability Officer, in charge of operational risks, shall undertakegroupwide efforts for the Teijin Group to enhance the risk management system, identify problems and deal with risks
upon occurrence thereof. The CEO shall assess the strategic risks of the Teijin Group, and present the assessment to theBoard of Directors, etc. of the Company, so that the directors can use it in the course of making managerial decisions.
In addition, the Chief Sustainability Officer shall implement necessary measures to ensure the continuation ofbusinesses of the Teijin Group in the face of risks arising from disasters, the inappropriate performance of duties bydirectors, officers and employees, and the technical problems in critical IT systems.

673) Systems for Ensuring that Duties by Directors of the Company and Its Subsidiaries Are Performed Efficiently
The Company shall establish the Group Regulations to provide the necessary rules and guidelines for the Group to
ensure the efficient performance of duties throughout the Teijin Group.
The Board of Directors of Teijin shall have representative directors, etc. execute business operations, and the mattersdelegated to the representative directors, etc. shall be determined by the organization and in compliance with theprocedures stipulated by internal regulations. These regulations shall be revised as necessary to reflect any revision and/or
abolition of laws and/or to increase efficiency.
The Board of Directors of Teijin shall organize the basic structure of the Teijin Group, and shall promote efficientmanagement and supervision of these organizational bodies.
The Company shall formulate the Group medium-term management plan, and each fiscal year it shall formulate shortterm management plans and the Group’s entire key management targets and budgets, and check their progress, in order torealize the medium-term management plan.
4) Systems for Ensuring that Proper Business Operations Are Conducted within the Teijin GroupThe Company shall establish the Group Regulations to provide the necessary rules and guidelines for the Group to
ensure appropriate business operations throughout the Teijin Group. Each Teijin Group company shall establish its own
regulations based on the Group Regulations, and shall use appropriate processes for deciding on important issues.
The Company shall discuss important matters concerning Teijin Group companies at its Group meeting and othermeetings, and shall require Teijin Group companies to make reports.
The Representative Director and other officers shall provide necessary instructions to ensure that Teijin Group
companies have appropriate internal control systems.
The Corporate Audit Department of the Company shall operate and supervise internal audits of the Teijin Group’sbusiness operations to ensure the efficiency and validity of internal control functions over the entire business of the TeijinGroup.
The Statutory Auditors of the Company shall establish appropriate systems, such as those for close cooperation withoutside accounting auditors and the Corporate Audit Department, to ensure effective and appropriate supervision andauditing of the Group’s entire business operations.
To ensure the reliability of its financial reporting, the Company shall establish a general internal control system overfinancial reporting covering the general operation of the Teijin Group and specific internal control systems covering
individual operational processes, which shall be properly and efficiently operated and assessed.
5) Systems for the Preservation and Management of Information in Relation with the Directors’ Performance of Their
DutiesDirectors shall preserve and manage, in an appropriate manner and in accordance with the relevant internal regulations,documents related to the execution of their duties, including the minutes of General Meetings of Shareholders andminutes of the Board of Directors meetings, and other important information. The CEO shall be responsible formonitoring and supervising the preservation and management of these documents and information. Documents related tothe performance of director duties shall be preserved for at least ten (10) years, and shall be accessible whenevernecessary.
6) Provisions Concerning Employees Assigned to Assist the Statutory Auditors in Performing Their Duties, theIndependence from Directors of Such Employees, and the Validity of Instructions Given to Such Employees
68

The Teijin Group Auditors Office, under the supervision of a full-time Statutory Auditor, shall be put in place as anorganization to assist with the duties of the Statutory Auditors. In principle, the number of members of the Teijin Group
Auditors Office shall be two or more. Note that members of the Teijin Group Auditors Office may also concurrently serve
as a Statutory Auditor of a Teijin Group company. However, they shall not concurrently hold positions related to the
execution of operations at a Teijin Group company.
To secure the independence of members of the Teijin Group Auditors Office, all decisions concerning personnel issues
affecting the members require the prior consent of full-time Statutory Auditors, and full-time Statutory Auditors shallassess the performance of the members.
7) Systems for Reporting to Statutory Auditors by Directors, Corporate Officers and Employees of Teijin and its
Subsidiaries, and Other Systems for Reports to Statutory Auditors
Full-time Statutory Auditors of the Company 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, etc. shall report at the meetings of the Board of Directors and other important meetings ontheir performance of duties with regard to the business operations, functions, and subsidiaries under their charge.
Directors, officers and employees of the Company and its subsidiaries shall report to a Statutory Auditor of theCompany as soon as they discover a significant decline in Company's credibility, serious adverse effects on theperformance of the Company, significant damage related to the environment, safety and health (ESH) or product liability(PL), serious violations of internal rules and other similar events.
Directors, officers and employees of Teijin and its subsidiaries shall report on the business operations, functions, andsubsidiaries under their charge, when they deem it necessary to do so, or at the request of the Statutory Auditors of theCompany, and shall cooperate with the investigations of the Statutory Auditors of the Company.
8) Systems for Ensuring that Persons Reporting to the Statutory Auditors Are Not Subject to Unfair Treatment Because of
Such Reporting
The Teijin Group stipulates in the Regulations for Teijin Group Corporate Ethics that no person shall be treatedunfairly because of reporting or notifying illegal or unethical conduct and so forth.
9) Policy Regarding Processing of Expenses and Liabilities Arising with Respect to the Statutory Auditors’ Performanceof Duties, Prepayment of Expenses, and Reimbursement Procedures
The Company shall bear the expenses and liabilities required for the Statutory Auditors’ performance of duties, andshall promptly respond to requests for pre-payment of expenses in accordance with the Companies Act after
confirmation.
10) Other Systems for Ensuring that the Audits of Statutory Auditors Are Conducted Effectively
The majority of members sitting on the Board of Statutory Auditors shall be Independent Outside Statutory Auditors
who satisfy the independence requirements set by the Company, thereby ensuring transparency.
The Company’s Statutory Auditors shall enter into advisory agreements with outside law firms in order for themselves
and subsidiaries’ statutory auditors to form independent opinions. When they consider it necessary in the course of
conducting audits, the Auditors can, at their own discretion, retain outside advisers, including Certified Public
Accountants and other consultants.

69

(2) Overview of the use of the internal control system
An overview of the use of the internal control system in FY2023 in accordance with the “Resolutions on Basic Systems
for Internal Control” is as follows.
1) Operations related to legal compliance
The Company shall post the Teijin Group’s Corporate Governance Guide, which stipulates the basic principles forcompliance, and related regulations for putting those basic principles into practice on the Company intranet. In addition,
the Company has designated October of each year as Corporate Ethics Month and plans to make compliance common
knowledge, including by holding in-house training. Also, when making important decisions, we aim to avoid violatinglaws and regulations by confirming with related dedicated departments.
The Company has set up a compliance promotion organization under the Chief Sustainability Officer and is working tograsp and address issues across the Teijin Group. Moreover, the Chief Sustainability Officer shall appropriately handle
important compliance issues reported by directors, officers and employees at the Company and its subsidiaries inaccordance with the Regulations for Teijin Group Corporate Ethics, etc., which stipulate rules for reporting andresponding to violations. These matters shall be reported regularly to the Members of the Board and Statutory Auditors.
The Company has established an internal reporting system, including a compliance hotline, that facilitates anonymous
reporting. Consultations by domestic and overseas group companies are properly handled, including the protection ofwhistleblowers. We are working to ensure thorough awareness through the disclosure of the response status on the
Company intranet, etc. twice a year.
The Company respects and appropriately responds to matters pointed out by Statutory Auditors in Statutory Auditor
audits and evaluations of the maintenance and operations of the internal control system. In accordance with the annual
plan, the Corporate Audit Department of the Company conducts internal audits across the Teijin Group and reports theaudit results to the Members of the Board and the Statutory Auditors.
The Company has established a policy for responding to anti-social forces in its Code of Conduct, and is working toensure thorough awareness of this policy through Corporate Ethics Month and other events.
2) Operations related to loss risk management
The Board of Directors of the Company receives reports from the TRM Committee on proposals for TRM basic
policies and annual plans, as well as the status of such risk occurring and the status of response. The Board of Directors isestablishing a system to manage important risks and for business continuity.
The Chief Sustainability Officer regularly evaluates and monitors operational risks, and continuously verifies thevalidity of risk extraction and countermeasures.
At important meetings, including Board of Directors meetings, the Company evaluates matters for deliberation
factoring into the results of a strategic risk assessments conducted in accordance with internal regulations.
The Company, to ensure the continuity of its business, is establishing necessary manuals and a system prepared for
emergencies, including holding regular drills.
The Company has also established separate rules for the "protection of personal information" and "information
security," and implements various in-house training and measures to strengthen security in an effort to prevent the risk of
information leaks.
3) Operations related to ensuring effectiveness
The Company posts the Group Regulations on the Company intranet to ensure thorough awareness. The Company, in70accordance with internal regulations, is clarifying its management structure, division of duties, responsibilities andauthority, and aims for efficient and effective business execution.
4) Operations related to internal controls as a corporate group
The Company regularly conducts self-inspections regarding the establishment and operation of an internal control
system, and provides ongoing guidance to each Teijin Group company pertaining to the maintenance of the internal
control system, including regulations, meeting bodies, and reporting systems.
The Statutory Auditors of the Company, to promote fair and efficient auditing activities in the Teijin Group, regularly
carry out Committee of Teijin Group Statutory Auditors meetings. They also work closely with the accounting auditor
and the Corporate Audit Department by attending accounting auditor reporting sessions and reporting the results ofoperational audits.
5) Operations related to storing information
The Directors of the Company shall properly store and manage important documents related to the execution of duties
in accordance with internal regulations.
6) Operations to ensure the effectiveness of audits by Statutory Auditors
The Company has established the Teijin Group Auditors Office. The staff members of the Teijin Group Auditors Office
are engaged in audit-related support work based on the instructions and orders of the Statutory Auditors.
The Company's full-time Statutory Auditors attend important meetings at the Company and its major subsidiaries, andreceive reports on the status of business execution from the representative directors, executive directors and corporate
officers who attend these meetings.
The Chief Sustainability Officer reports to meeting members, including the Statutory Auditors, individually or throughimportant meetings as soon as a matter designated to be important is discovered, including whistle-blowing via hotlines.
Directors, officers and employees of the Company and its subsidiaries appropriately respond to requests from Statutory
Auditors and take steps to ensure the effectiveness of audits carried out by Statutory Auditors.

7110. Basic Policy on Corporate Control(1) Basic Policy Regarding the Company’s Shareholders(Basic policy regarding those who control decisions on the company’s financial and business policy)
The Company believes that the ideal situation for its shareholders is determined based on free trade in the market.
Consequently, decisions, such as whether to comply with an acquisition proposal that would accompany a transfer of theCompany’s control, should ultimately be made based on the wishes of all shareholders.
However, it is envisaged that a part of a large-scale acquisition of the Company’s shares or an acquisition proposal may
include “the likelihood of causing obvious harm to the corporate value of the Company and therefore the common interestsof the shareholders,” “the possible threat to compel shareholders to sell their shares,” and “cases where the compensation
for the acquisition is insufficient in view of the corporate value of the Company.” The Company believes that an entity thatengages in such a large-scale acquisition or proposes such an acquisition is not appropriate, as an exceptional circumstance,
to control decisions on the Company’s financial and business policies.
(2) Initiatives that contribute to the realization of this basic policy
The Company, to ensure that many institutional investors continue to invest in the Company over the long term, is already
implementing the following measures as actions to improve its corporate value, and by extension the common interests of
its shareholders. We believe these actions will contribute to the realization of the Basic Policy in (1) above.
1) Initiatives to improve profit
The Teijin Group announced the “Teijin Group Medium-Term Management Plan 2024-2025” in May 2024. In theplan, the Group clarified that it will further embody its long-term vision of "a company that supports the society of the
future", and will become a “company that prioritizes the health of the planet, protects the global environment, andsupports a circular economy” through its business in the mobility, infrastructure and industry fields, and conduct its
business as a “company that addresses issues of patients, families and communities in need of more support” mainly inthe field of rare and intractable diseases. In addition, in FY2024, the Group will work on (ⅰ) Recovering earning powerby completing the profitability improvement measures, (ⅱ) Implementing business portfolio reforms, and(ⅲ)

Rebuilding the intangible global management base. For the specific details of these initiatives, please refer to “1. Matters
Concerning the Current Status of the Teijin Group (corporate group), (8) Management Policy and Tasks Ahead,” in the
Notice of Convocation of the 158th Ordinary General Meeting of Shareholders.
2) Initiatives to improve corporate value through the strengthening of corporate governance
The Company has been promoting and undertaking the strengthening of corporate governance as an important matter,
given it is an essential mechanism for improving corporate value, and by extension enhancing the common interests ofshareholders. For the specific details of this, refer to aforementioned “”Corporate Governance System” in the Notice ofConvocation of the 158th Ordinary General Meeting of Shareholders.
(3) Initiatives to prevent a person/entity deemed inappropriate from controlling decisions on the Company’s financial andbusiness policies in light of basic policies
The Company will continue to make requests of parties that conduct large-scale acquisitions of the Company’s shares orare intending to carry out a large-scale acquisition for the provision of necessary and sufficient information so thatshareholders can make proper decisions on the appropriateness of such large-scale acquisitions. In addition, the Company
shall implement adequate measures in accordance with the Financial Instruments and Exchange Act, the Companies Act
and other relevant laws and regulations, including the disclosure of the opinions, etc. of the Board of Directors of the72Company and steps to secure the time and information necessary for consideration by shareholders.
Please note that initiatives (2) and (3) above conform with the Basic Policy in (1) above. In addition, this is not
detrimental to corporate value or the common interests of shareholders, and is not for the purpose of maintaining theposition of the Company’s directors.

11. Policy Regarding the Determination of Dividends from Retained Earnings
Taking into account “stable and sustainable dividends,” the Company will flexibly conduct the repurchasing of its own
shares, etc. depending on the situation. We aim to boost our dividends in line with earnings performance. We are targeting apayout ratio of 30% of profit attributable to owners of parent for the medium term.
◎ Dividends from surplus in FY2023: Based on the above policy, we decided the following for the fiscal year-end dividend
for the 158th fiscal year. Reflecting this, our annual dividend will be 30 yen per share, which includes the interim dividend of
15 yen per share, which was implemented on December 1, 2023.
Fiscal year-end dividend: 15 yen per share
Date the dividends from surplus takes effect: May 30, 2024 (Thursday)7312. Financial Statement(1) Consolidated Balance Sheets

74

75

(2) Consolidated Statements of Income76

(3) Consolidated Statements of Changes in Net Assets

77

78

(Reference)Consolidated Statements of Cash Flows79