February 10, 2022

Engagement Agenda“Many ‘Against’ Votes”
Responses by Companies to Which Many “Against” Votes Were Cast at Their General
Meeting of Shareholders in 2020, AndSending Letters to Companies on Which Many “Against” Votes Were Cast at Their
General Meeting of Shareholders in 2021

The Institutional Investors Collective Engagement Forum (hereinafter referred to as “IICEF”)
serving as a coordinator/secretariat for a collective engagement program, together with the sevencompanies, namely The Dai-ichi Life Insurance Company, Limited, Meiji Yasuda Asset ManagementCompany Ltd., Mitsubishi UFJ Trust and Banking Corporation, Pension Fund Association, Resona AssetManagement Co., Ltd., Sumitomo Mitsui DS Asset Management Company, Limited and Sumitomo
Mitsui Trust Asset Management Co., Ltd. (in alphabetical order; hereinafter referred to as the“Participating Investors”), has sent request letters to certain companies. In the letters, we requested
explanations on the outcomes of the analysis of the reasons for the considerable number of votes
cast against the top management’s proposals for director election at their general meeting ofshareholders, even though those proposals were still approved. In the same manner, we requestedconsiderations of the need for shareholder dialogue and other measures.
***1. Overview of this agenda
In recent years, with more proactive and stricter stances on exercise of voting rights by investors
and shareholders including institutional investors in and outside of Japan, there are increasing
number of cases where quite a few votes are cast against company’s management proposal at
general meetings of shareholders.
Supplementary Principle 1.1.1 of Japan’s Corporate Governance Code stipulates “When theboard recognizes that a considerable number of votes have been cast against a proposal by thecompany and the proposal was approved, it should analyze the reasons behind opposing votes andwhy many shareholders opposed, and should consider the need for shareholder dialogue andother measures.”1

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Contents of proposals against which a considerable number of “against” votes are cast at a
general meeting of shareholders are diverse. However, this time, we focused on the cases where a
considerable number of votes have been cast against top management’s proposals for director
election. In these cases, apparently some shareholders are supposed to have found concerns over
the overall management quality, business performances, etc., of the company and therefore we
decided to request explanations on their analysis of the reasons behind the “against” votes as wellas their considerations of the need for shareholder dialogue and other measures.

[Matters we requested explanations](i) How has the board conducted discussion and analysis of the reasons behind a considerable
number of shareholders voting “against” proposals from the company for director election?
What measures have been taken to understand the reasons for the shareholders’ “against”
votes? How has the board considered the need for shareholder dialogue and other measures?
(ii) What views have outside directors in particular expressed on the general meeting’s vote results,and discussion and analysis of the results at board meetings?
(iii) Based on these considerations, what does the company think about its key challenges in its
management policy and strategies, corporate governance, efficient use of capital, and so forth?
How is the company going to deal with the challenges?

2. Status of holding collective engagement dialogues
The contents of this agenda were summarized as the common views of the Participating
Investors in 2020, and we sent letters to 5 companies selected based on certain criteria among thecompanies at which a considerable number of votes were cast against management’s proposals
for election of top management at their general meetings of shareholders held between Marchand June 2020. In so doing, we excluded the companies to which we sent the letters in the pastand took into consideration the various managerial impacts by COVID-19. We received
explanations from 2 companies through interviews and from 1 company in writing.
As a result, it was found that each of those companies has analyzed the results of the general
meeting of shareholders and the reasons for the many “against” votes and reported the findings
to the board members. Some companies discussed how they should improve the situation andhow they should better communicate with investors at the interviews with IICEF secretariat. On
the other hand, there were companies who did not reply, which implies their recognition of
investors’ voice is insufficient.
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We provided each company with comments by the Participating Investors on the company’sexplanations as feedback.
The companies to which we sent letters showed decline in the rate of votes against the company
proposal for election of top management at their general meetings in 2021. On the other hand,the companies who did not explain to us faced an increase in the rate of “against” votes; and weintend to continue paying attention to the measures of, and holding dialogue with, thesecompanies.

3. Starting to send letters for 2021
We started in January 2022 to send letters to those companies requesting explanations on theresult of the considerations concerning the analysis of the reasons for the considerable number ofvotes cast against the company proposals for director election at their general meetings ofshareholders held between March and June 2021, even though the proposals were still approved,
and the need for shareholder dialogue and other measures. We sent the letter to the same
companies when they were still voted against at above a certain rate.

[Reference: Related stipulations in the U.K. Corporate Governance Code]
There are stipulations in Chapter 1, Provision 4 of the U.K. Corporate Governance Code (revised inJuly 2018; enacted in January 2019) as follows:“When 20 per cent or more of votes have been cast against the board recommendation for aresolution, the company should explain, when announcing voting results, what actions it intends totake to consult shareholders in order to understand the reasons behind the result. An update on theviews received from shareholders and actions taken should be published no later than six months
after the shareholder meeting. The board should then provide a final summary in the annual report
and, if applicable, in the explanatory notes to resolutions at the next shareholder meeting, on what
impact the feedback has had on the decisions the board has taken and any actions or resolutions now
proposed. ”

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***Contact information:
Institutional Investors Collective Engagement Forum
Directors in charge: Yuki Kimura, Chairman; Naomi Yamazaki, Administration Manager; Ryusuke Ohori,
Executive Director; and Hiromitsu Kamata, Executive Director
Address: Tokyo Entre Salon, Shinmaki-chou Building Annex 1, 3-2-14, Nihonbashi, Chuo-ku, Tokyo
103-0027 JAPANE-mail: info@iicef.jp

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