Progress of Initiatives for the Key Issues (Materiality) and the Individual Issues (FY2022)

Themes

FY2022 Initiatives

Target for FY2022

1.Enhancement of business competitiveness and R&D capabilities
Create new products and services that solve issues

Develop products and services to help solve
social issues

surrounding babies who need special support such as NICU

Launched low-birth-weight baby oil that considers the skin barrier of infants [China]

hospitalization, and their families

Published a information booklet for the families using donor milk (67 hospitals used) [Japan]Provided information on breastfeeding and general childcare to pre-mothers and mothers through webinars and our official SNS

Enhance activities to solve issues surrounding babies andtheir families

Future Project that is an initiative that leads society as a whole to think and act in order to realize a baby-friendly future was held at 143 schools,
with 11,845 students taking classes from April 2022 to March 2023 [Japan]
83% of inquiries resolved by AI chatbots [China]

Increase productivity with AI and IoTPromote the use of IT tools

Expand the scope of utilization of RPA tools for system infrastructure operations [Japan]
Expand applications through a workflow system, promoting paperless operations and streamlining operations [Japan]

Improve productivity by streamlining theproduct development process
Maintain and improve product quality

Review product development process
Continue quality improvement activities

Speeded up the launch by transferring a part of the authority of the development process to the Singapore Business Unit
Added implementation details and updated the "Quality and Safety Initiatives" web page
Continuous quality improvement activities at each factory based on the principles of quality management

2.Sustainable reduction of environmental impact
Articulate environmental policy andenvironmental vision

Articulate environmental policy and environmental vision

Three Sustainability Committee meetings were held to discuss the environmental vision "Pigeon Green Action Plan".
Reduced CO2 emission intensity by 56.8% compared with FY2018
Reduced absolute CO2 emissions by 58.4% compared with FY2018

Respond to global warming

Reduce CO2 emission intensity* by 10% compared withElectricity from renewable sources accounted for 17% of the total electricity consumption.

FY2018

Conducted a qualitative analysis of climate-related risks and opportunities for the nursing bottle/nipple and skincare businesses based on the*Scope 1 and 2 CO2 emissions per unit of sales

TCFD recommendations, and disclosed the results in the Pigeon Group TCFD Report 2022.
Installed new solar panels [Pigeon Manufacturing Hyogo, Central Laboratory, Tsukuba office], expanded solar panels [Indonesia]
Purchased electricity from renewable sources [Central Laboratory]

Reduce supply chain emissions
Develop environment-friendly products andpackaging

Disclosed Scope 3 GHG emissions of Japan and Lansinoh Businesses for FY2020
Started calculation of Scope 3 GHG emissions of China and Singapore Businesses

Create new environmentally-friendly products and packages
Reduction of petroleum-based plastics and virgin raw

Launch of nursing bottle products using biomass plastic [Singapore]materials
Implemented of a nursing bottle recycling campaign: 52,837 bottles collected (PPSU 160ml weight conversion)*1 [Singapore]Started Pigeon's nursing bottle collection and recycling demonstration experiment in collaboration with a major baby product retailer: 7,437

Reduce plastics

bottles*2 were collected including plastic nursing bottles, glass nursing bottles, nipples, and parts, etc. [Japan]
Consider plastic recycling system

Collected 1,660 kg of PPSU bottles including returns*3 [China]*1 Collection period: 2019 to January 2023
*2 Collection period: August 25, 2022 to the end of February 2023
*3 Collection period: January to December 2022

Prevent pollution
Share knowledge on reduction ofenvironmental impact
Introduce an environmental managementsystem
Earmark funds for environmental costs

Reduce industrial waste intensity* by 1% or more per year

Reduced industrial waste volume intensity by 28% compared with 2021

*non-recycled industrial waste per unit of sales

Improved recycling rate of 94% (Definition of recycling includes reuse and thermal recovery)

Share knowledge on reduction of environmental impact

Shared knowledge of ESG activities throughout the GroupAcquire ISO 14001 certification for all production sites

All production sites have acquired ISO 14001 (Achieved by 2020)

Promote environmental protection initiatives at each site

Environmental protection initiatives are in process at each site.

3.Enhancement of stakeholder responsivenessPromote CSR procurement
Respond in a responsible manner toconsumers

Formulate CSR Procurement PolicyConducted CSR procurement assessment (236 companies responded, 96% response rate)
Disclosed results of the assessments on our website
Disclosure of the status of activities based on consumer-focused voluntary declaration [Japan]

Enhance VOC (Voice of Customer) activities

Awarded "Consumer Oriented Activity Award" at the 7th ACAP Consumer Oriented Activity Awards [Japan]
Share customer feedback with management and related departments and use it to improve products and services
Support for premature babies (Gold sponsor of Japan Human Milk Bank Association [Japan], A main partner of Cunmiao Foudation [China],Providing and donating products such as breast pumps to breast milk banks [Vietnam, India]
Support for children with cleft lip and/or palate including donation of feeding bottles for them and support through collaboration with NGOs
Tree planting and forest conservation

Engage in social contribution activities

Promote social contribution activities

Received an award in the "Contribution to fulfilling the public functions of forests" category at the "Forest x Decarbonization Challenge 2022"
sponsored by the Forestry Agency [Japan]
Cleanup activities around offices
Donations to hospitals and maternity hospitals and support groups
Started company-led volunteer activities (31 employees participated, total volunteer time 146 hours) [Japan]

Engage in dialogue with shareholders andinvestors in a responsible mannerMore than 300 IR meetings per year

332 IR meetings (Total for FY2022)

Formulate HR Development Policy

Disclosed the Human Resources Development Policy on the website. Shared the policy with group companies [Japan]

4.Improvement in quality of human resources
Articulate HR development policy
Promote HR development and hiring on aglobal basis
Reinforce expertise of each department

Create global human resource development program
Develop an education system that strengthens expertise

Global Leadership Training to develop global human resources has been conducted. Through this training, 12 global players going to workoverseas in the future, and 29 global supporters who work in Japan for overseas business have been selected [Japan]
Technical skills required for each department are prepared for each department and role grade, and human resources are developed based onthem [Japan]

5.Creation of an ideal working environment
Formulation of diversity and inclusion policy [Japan]
Promote diversity

Return-to-work rate from childcare leave: 83% (5 persons out of 6 persons) [Japan]
Retention rate of employees returning to work after childcare leave: 100% [Japan]

Promote diversity

Increase the ratio of female managers
Maintain 100% of men and women taking childcare leave forat least one month [Pigeon]

Maintained 100% of aquisition rate for eligible employees since FY2016. (FY2022: total of 18 men and women) [Japan]
Establishment of a familyship system and consultation desk as an initiative related to LGBTQ+ [Japan]

Take initiatives toward diverse working styles

Implement systems to promote diverse working styles

Number of employees who took "Life Design Leave and Temporary Retirement": 1 employee in 2022 [Japan]
Number of employees who took "Nursing Care Leave": 5 employee in 2022 [Japan]
Introduction of hourly paid leave [Japan]

Paid leave acquisition rate 70% or more [Japan]
Promote work-life balance

Promote health management

Paid leave acquisition rate was 83% (FY2021: 70% FY2020: 64%) [Japan]
implemented by the Ministry of Economy, Trade and Industry and Japan Hearlth Council. [Japan]

6.Establishment of a solid management base
Introduce a new personnel system

Introduce a new personnel system

Put risk management in place

Strengthen risk response capabilities

Since the new personnel system released in January 2021, we conducted a survey of all employees to measure the degree of penetration andeffectiveness of this system. Based on this result we will review the operation of the personnel system and the rules in 2023 [Japan]
Held the GHO Risk Management Committee twice in 2022.
Identified priority risks of compliance, finance, information security, SCM (supply chain management), and customer complaints, andimplemented risk management across Pigeon Group
Continued implementation of general compliance training at all Pigeon Group companies
Regarding the whistle-blowing system, we have completed preparations for the introduction of a system that guarantees anonymity andStrengthen compliance

Implementation of measures to enhance compliancesupports multiple languages so that it can be operated from 2023, and we have disseminated how to use the system
Regarding the global compliance policy ("anti-bribery and corruption", "competition law", "information management"), the policy have beenthoroughly informed so that it can be applied throughout the Pigeon GroupStrengthen brand power

Implement actions to strengthen Corporate brand

Planning and execution of various inner and outer branding projects and support for measures in each business unit
Conducted regular meetings with group companies to share brand information
Held three Sustainability Committee meetings
External ESG evaluation has improved, have been included in the SOMPO Sustainability Index, FTSE Blossom Japan Sector Relative Index, andFTSE Blossom Japan Index.

Enhance ESG responsivenessPromote ESG initiatives

Received a 'B' score in December after completing the CDP climate change questionnaire 2022 for the first time
Set non-financial KPIs and implement PDCA to resolve issues
Enhanced disclosure of non-financial information on the website (15 articles on the "Our Sustainable Actions" page introducing Group-wideinitiatives)
To promote ESG awareness among employees, we send out an ESG-themed internal newsletter to all Group employees four times in 2022.