This is an excerpt translation of the Japanese original. In the event of any discrepancy between this translated
document and the Japanese original, the original shall prevail.

Annual Securities Report(Report pursuant to Article 24, Paragraph 1 of the
Financial Instruments and Exchange Act)The 53rd Fiscal Year(from April 1, 2023 to March 31, 2024)(E04788)-1-

Table of Contents
Page
Cover page
Part 1 Company Information................................................................................................................................................................... 4
Item 1. Overview of the Company and its Consolidated Subsidiaries ................................................................................................... 4
1. Summary of Business Results ................................................................................................................................................... 4
2. History....................................................................................................................................................................................... 6
3. Description of Business............................................................................................................................................................. 8
4. Overview of Subsidiaries and Affiliates .................................................................................................................................. 10
5. Employees ............................................................................................................................................................................... 13
Item 2. Business Overview .................................................................................................................................................................. 16
1. Management Policy, Business Environment and Tasks Ahead, etc. ....................................................................................... 16
2. Concept and Efforts for Sustainability .................................................................................................................................... 24
3. Business and Related Risks ..................................................................................................................................................... 30
4. Management’s Analyses of Consolidated Financial Position, Operating Results and Cash Flows ......................................... 39
5. Material Agreements, etc. ....................................................................................................................................................... 50
6. Research and Development Activities .................................................................................................................................... 50
Item 3. Property, Plants and Equipment .............................................................................................................................................. 51
1. Leased Assets .......................................................................................................................................................................... 51
2. Assets for own Use.................................................................................................................................................................. 51
Item 4. Information on the Company .................................................................................................................................................. 52
1. Information on the Company’s Shares, etc. ............................................................................................................................ 52
2. Acquisitions, etc. of Treasury Shares ...................................................................................................................................... 63
3. Dividend Policy ...................................................................................................................................................................... 64
4. Corporate Governance, etc. ..................................................................................................................................................... 65(Note) This document is an excerpt translation of the Annual Securities Report (The 53rd Fiscal Year from April 1, 2023 to March
31, 2024), which was originally prepared in Japanese, that covers up to “Item 4. Information on the Company.” For details
regarding “Item 5. Financial Information” of the Annual Securities Report prepared in Japanese, please refer to Financial
Information 2024 (For the year ended March 31, 2024).

-2-

CoverDocument Title

Annual Securities Report (“Yukashoken Hokokusho”)

Clause of Stipulation

Article 24, Paragraph 1 of the Financial Instruments and Exchange Act

Place of Filing

Director-General of the Kanto Local Finance Bureau

Filing Date

June 25, 2024

Fiscal Year

The 53rd Fiscal Year (from April 1, 2023 to March 31, 2024)

Company Name

Mitsubishi HC Capital Inc.

Company Name in English

Mitsubishi HC Capital Inc.

Title and Name of Representative

Taiju Hisai, Representative Director, President & CEO

Address of Registered Head Office

5-1, Marunouchi 1-chome, Chiyoda-ku, Tokyo

Telephone Number+81-3-6865-3004

Name of Contact Person

Hirokazu Kato, Senior Corporate Officer, General Manager of Accounting
Department

Nearest Place of Contact

5-1, Marunouchi 1-chome, Chiyoda-ku, Tokyo

Telephone Number+81-3-6865-3004

Name of Contact Person

Hirokazu Kato, Senior Corporate Officer, General Manager of Accounting
Department

Place for Public Inspection

Tokyo Stock Exchange, Inc.
(2-1, Nihombashi Kabutocho, Chuo-ku, Tokyo)
Mitsubishi HC Capital Inc. Nagoya Office(22-24, Marunouchi 3-chome, Naka-ku, Nagoya, Aichi)
Mitsubishi HC Capital Inc. Makuhari Office(6-1, Nakase 2-chome, Mihama-ku, Chiba, Chiba)
Mitsubishi HC Capital Inc. Osaka Office(1-1, Fushimimachi 4-chome, Chuo-ku, Osaka, Osaka)
Mitsubishi HC Capital Inc. Omiya Branch(11-3, Sakuragicho 1-chome, Omiya-ku, Saitama, Saitama)
Mitsubishi HC Capital Inc. Yokohama Branch(11-5, Kitasaiwai 1-chome, Nishi-ku, Yokohama, Kanagawa)-3-

Part 1 Company Information
Item 1. Overview of the Company and its Consolidated Subsidiaries
1. Summary of Business Results(1) Consolidated
Fiscal Year

49th

Year ended

50th

51st

52nd

53rd

March 31, 2020 March 31, 2021 March 31, 2022 March 31, 2023 March 31, 2024

Revenues(Millions of Yen)

923,768

947,658

1,765,559

1,896,231

1,950,583

Recurring Income(Millions of Yen)

94,37664,968117,239

146,076

151,633

Net Income Attributable to
Owners of the Parent(Millions of Yen)

70,75455,314

99,401

116,241

123,842Comprehensive Income(Millions of Yen)

48,29653,066

174,586

265,136

220,222

Total Equity(Millions of Yen)

798,820

817,906

1,333,467

1,551,029

1,705,345

Total Assets(Millions of Yen)

6,285,966

6,014,896

10,328,872

10,726,196

11,149,858

Equity per Share(Yen)

872.78901.66912.191,064.46

1,174.88

Earnings per Share

(Yen)

79.44

62.07

69.24

80.95

86.30

Diluted Earnings per Share

(Yen)

79.14

61.84

69.06

80.71

86.06

Equity Ratio

(%)

12.4

13.4

12.7

14.3

15.1

Return on Equity

(%)

9.2

7.0

8.0

8.2

7.7

Price Earnings Ratio(Times)

6.7

10.8

8.2

8.4

12.4

Cash Flows from Operating
Activities(Millions of Yen)

(252,199)

199,314

195,845

46,752(49,128)

Cash Flows from Investing
Activities(Millions of Yen)

(32,988)1,220(107,879)(127,322)

143,336

Cash Flows from Financing
Activities(Millions of Yen)

552,320(372,808)(192,157)(8,948)(222,977)

Cash and Cash Equivalents
at the End of the Year

(Millions of Yen)

455,588286,213520,083

460,486

335,307

3,301
(277)

3,284
(372)

8,803
(1,569)8,648(1,462)

8,424(1,383)

Number of Employees(Separately, Average
Number of Temporary
Employees)(Persons)(Notes) 1. Effective from the 51st term, the Company changed its accounting policies for “Method for How to Post Re-leasing
Revenues in Lease Transactions,” “Method for Posting Lease Transactions as Finance,” and “Method for Posting Deferred
Assets (Bond Issuance Cost),” and the new accounting policies have been retrospectively applied to the figures of the 50thterm.
2. A performance-based stock compensation plan has been introduced from the 53rd fiscal year. The Company’s shares heldby a trust under the performance-based stock compensation plan are included in the number of treasury shares excluded
from the number of outstanding shares as of March 31 used for calculation of equity per share. They are also included in
the number of treasury shares deducted in the calculation of average number of shares outstanding during the period forthe purpose of calculating earnings per share and diluted earnings per share.

-4-(2) Management Indicators of the Submitting Company, etc.
Fiscal Year

49th

Year ended

50th

51st

52nd

53rd

March 31, 2020 March 31, 2021 March 31, 2022 March 31, 2023 March 31, 2024

Revenues(Millions of Yen)

470,854492,019

838,475

764,506

755,707

Recurring Income(Millions of Yen)

41,087

61,392

34,00879,91073,293Net Income(Millions of Yen)

38,76863,39951,58482,20482,798

Share Capital(Millions of Yen)

33,19633,19633,19633,19633,196

895,834,160 1,466,912,244 1,466,912,244

1,466,912,244

Total Number of Issued Shares(Shares)895,834,160

Total Equity(Millions of Yen)

508,589

557,554880,601

881,212851,108

Total Assets(Millions of Yen)

4,476,092

4,181,294

5,700,025

5,317,966

4,963,571(Yen)

569.07623.69612.00612.09592.04(of the above Interim Dividendper Share)

25.00(12.50)25.50(12.75)28.00(13.00)33.00(15.00)

37.00

(Yen)

(18.00)Earnings per Share

(Yen)

43.53

71.14

35.93

57.24

57.70

Diluted Earnings per Share

(Yen)

43.36

70.87

35.84

57.08

57.54

Equity Ratio

(%)

11.3

13.3

15.4

16.5

17.1

Return on Equity

(%)

7.7

11.9

5.7

9.4

9.6

Price Earnings Ratio(Times)

12.2

9.4

15.9

11.9

18.5

(%)

57.4

35.8

77.9

57.7

64.1

1,379
(105)

1,412
(112)

2,235
(289)

2,182
(282)

2,140

(Persons)
(%)
(%)

98.8
(90.5)

127.4(128.6)115.0(131.2)141.0(138.8)216.0(196.2)

(Yen)

728.0

699.0

670.0

747.0

1,095.5

(Yen)

445.0

437.0

521.0

558.0

675.0

Equity per ShareDividend per Share

Payout Ratio
Number of Employees(Separately, Average Number of
Temporary Employees)
Total Shareholders Return(Indicator: TOPIX Machinery
Index)
Highest Share Price of EachFiscal Year
Lowest Share Price of EachFiscal Year

(283)

(Notes) 1. The highest and lowest share prices were those on the First Section of the Tokyo Stock Exchange on or before April 3,
2022, and have been those on the Prime Market of the Tokyo Stock Exchange since April 4, 2022.
2. Effective from the 51st term, the Company changed its accounting policies for “Method for How to Post Re-leasing
Revenues in Lease Transactions,” “Method for Posting Lease Transactions as Finance,” and “Method for Posting Deferred
Assets (Bond Issuance Cost),” and the new accounting policies have been retrospectively applied to the figures of the 50thterm.
3. A performance-based stock compensation plan has been introduced from the 53rd fiscal year. The Company’s shares heldby a trust under the performance-based stock compensation plan are included in the number of treasury shares excluded
from the number of outstanding shares as of March 31 used for calculation of equity per share. They are also included in
the number of treasury shares deducted in the calculation of average number of shares outstanding during the period forthe purpose of calculating earnings per share and diluted earnings per share.

-5-2. History
Month and Year

Former Mitsubishi UFJ Lease & Finance Company
LimitedFormer Hitachi Capital Corporation

September

Established Tokyo Hitachi Home Electric Appliance

1957

Geppuhanbai Corp. and Osaka Hitachi Home ElectricAppliance Geppuhanbai Corp. (merged with Hitachi
Geppan Corp. in December 1960).

May 1958

Established Kyushu Hitachi Home ElectricAppliance Geppuhanbai Corp. and Nagoya Hitachi
Home Electric Appliance Geppuhanbai Corp.
(merged with Hitachi Geppan Corp. in December1960).

August 1960

April 1971

Established Hitachi Geppan Corp. (changed its tradename to Hitachi Credit Corp. in January 1969).
Established Diamond Lease Company Limited with a
total of 16 companies as shareholders, including 11
Mitsubishi Group companies, notably The Mitsubishi
Bank, Limited (currently MUFG Bank, Ltd.),
Mitsubishi Corporation, The Mitsubishi Trust andBanking Corporation (currently Mitsubishi UFJ Trustand Banking Corporation), Meiji Life Insurance
Company (currently Meiji Yasuda Life Insurance
Company), and Tokio Marine & Fire Insurance Co.,
Ltd. (currently Tokio Marine & Nichido Fire
Insurance Co., Ltd.), as well as Nippon Life Insurance
Company, The Dai-ichi Mutual Life Insurance
Company (currently The Dai-ichi Life Insurance
Company, Limited), and three affiliated companies of
The Chase Manhattan Bank (at that time).

December

Listed on the Second Section of the Tokyo Stock1976

Exchange.

September
1979

Listed on the First Section of the Tokyo Stock
Exchange.

March 1985

Listed on the Second Section of the Tokyo Stock
Exchange.

September
1988

Listed on the First Section of the Tokyo Stock
Exchange.

October 1999

Merged with Ryoshin Leasing Corp.

October 2000

Merged with Hitachi Leasing Corp. and changed its
trade name to Hitachi Capital Corp.

April 2007

Merged with UFJ Central Leasing Co., Ltd. andchanged its trade name to Mitsubishi UFJ Lease &Finance Company Limited.
Listed on the First Section of the Nagoya Stock
Exchange.

August 2016

Mitsubishi UFJ Lease & Finance Company Limited and Hitachi Capital Corp. entered into a capital and businessalliance.

-6-

Month and Year
April 2021

November
2021
April 2022

Mitsubishi HC Capital Inc.
Mitsubishi UFJ Lease & Finance Company Limited merged with Hitachi Capital Corp. and changed its tradename to Mitsubishi HC Capital Inc.
Acquired all shares of CAI International, Inc. and made it a consolidated subsidiary.
Following the reorganization of market segments on the stock exchanges, shifted to the Prime Market of theTokyo Stock Exchange and the Premier Market of the Nagoya Stock Exchange.

June 2024

Delisted from the Nagoya Stock Exchange.

-7-

3. Description of Business
The Group consists of the Company, its 437 subsidiaries and 89 affiliates. Other affiliated companies include Mitsubishi
Corporation and Mitsubishi UFJ Financial Group, Inc.
(1) The Group is conducting its business in the seven segments of “Customer Solutions,” “Global Business,” “Environment &Energy,” “Aviation,” “Logistics,” “Real Estate,” and “Mobility.”
The main businesses of each reportable segment are as follows.
Reportable Segments
Customer Solutions

Main Businesses
Finance solution business for companies and government agencies, energy-saving
solutions business, sales finance business provided through collaboration with vendors,
real estate leasing business, and financial service business

Global Business

Finance solution business and sales finance business provided through collaboration
with vendors in Europe, the Americas, China and ASEAN region

Environment & Energy

Renewable energy business, environment-related finance solution business

Aviation

Aircraft leasing business, and aircraft engine leasing business

Logistics

Marine container leasing business, and railway freight car leasing business

Real Estate
Mobility

Real estate finance business, real estate investment business, real estate asset
management business
Auto leasing business and supplementary services

In accordance with the organizational changes effective April 1, 2023, the name of the reportable segment “Environment,
Energy & Infrastructure” was changed to “Environment & Energy” from the fiscal year under review.

-8-

(2) Our business structure is shown below.

Other affiliatedcompanies

Mitsubishi Corporation

Mitsubishi HC Capital Inc.

Customer
SolutionsGlobal Business

Environment,& Energy< Major Consolidated Subsidiaries andAffiliated Companies Accounted for by the Equity Method >JAPAN MEDICAL LEASE CORPORATION
Mitsubishi HC Capital Estate Plus Inc.
Capital Insurance Corporation
Mitsubishi HC Business Lease Corporation
PT HCD Properti Indonesia
Mitsubishi Electric Financial Solutions Corporation
Mitsubishi HC Capital UK PLC
Mitsubishi HC Capital America, Inc.
Mitsubishi HC Capital Canada, Inc.
Mitsubishi HC Capital Canada Leasing. Inc.
Mitsubishi HC Capital (Shanghai) Co., Ltd.
Mitsubishi HC Capital Leasing (Beijing) Co., Ltd.
Mitsubishi HC Capital Factoring (Shanghai) Co., Ltd.
Mitsubishi HC Capital Management (China) Limited
Mitsubishi HC Capital (Hong Kong) Limited
Mitsubishi HC Capital Asia Pacific Pte. Ltd.
Mitsubishi HC Capital (Thailand) Co., Ltd.
PT. Mitsubishi HC Capital and Finance Indonesia
Mitsubishi HC Capital Energy Inc.
HSE Ltd.
Chubu Electric Power & MHC Germany Transmission GmbH

Aviation

JSA International Holdings, L.P.
Engine Lease Finance Corporation

Logistics

CAI International, Inc.
PNW Railcars, Inc.

Real Estate

Mitsubishi HC Capital Reality Inc.

Mobility

Mitsubishi Auto Leasing Corporation-9-

Customers

Mitsubishi UFJ Financial Group, Inc.

< Segment >4. Overview of Subsidiaries and Affiliates

Company Name

Location

Principal Business(Note 1)

Ownershipor
Ownership
Ratio of
VotingRights(%)

Relationship¥100 million Customer Solutions

100

Loans of business
funds
Loans of business
funds
Leasing of realestate and others

Share Capital(Consolidated Subsidiaries)
JAPAN MEDICAL LEASECORPORATION

Shinagawa-ku,
Tokyo

Mitsubishi HC Capital Estate
Plus Inc. (Note 2)

Chiyoda-ku,
Tokyo¥251 million Customer Solutions

100

Capital Insurance Corporation(Note 3)

Chiyoda-ku,
Tokyo¥6,200 million Customer Solutions

79.36

Mitsubishi HC Business Lease
Corporation (Note 3)

Minato-ku,
Tokyo¥10,000 million Customer Solutions

100

PT HCD Properti Indonesia(Notes 3 and 4)

Jakarta

Rp580,000 million Customer Solutions

63.45(63.45)

Mitsubishi HC Capital UK PLC Staines-upon(Notes 3 and 5)
ThamesSTG£116,168
Global Businessthousand100

Debt guarantee

Mitsubishi HC Capital
America, Inc. (Note 3)

US$180,000
Global Businessthousand100

Debt guarantee

Mitsubishi HC Capital Canada,
Burlington
Inc. (Notes 3 and 4)

CA$97,000
Global Businessthousand

100
(100)

Debt guarantee

Mitsubishi HC Capital Canada
Leasing. Inc. (Note 4)

Trois-Rivieres

CA$10,126
Global Businessthousand

100
(100)

Debt guarantee

Mitsubishi HC Capital(Shanghai) Co., Ltd. (Note 3)

Shanghai

US$55,000
Global Businessthousand100

Debt guarantee

Beijing

US$170,000
Global Businessthousand

100
(100)

Debt guarantee

Shanghai

RMB306,570
Global Businessthousand

100
(100)

Hong Kong

HK$2,285,516
Global Businessthousand100

Debt guarantee

Mitsubishi HC Capital (HongKong) Limited (Notes 3 and 4)

Hong Kong

HK$310,000
Global Businessthousand

100
(100)

Debt guarantee

Mitsubishi HC Capital Asia
Pacific Pte. Ltd. (Note 3)

Singapore

S$126,400
Global Businessthousand100

Debt guarantee

Bangkok

THB1,100,000
Global Businessthousand

100(51)

Debt guarantee

Rp400,000 million Global Business

100
(15)

Debt guarantee

Environment &Energy100

Leasing ofequipment, etc.
Loans of business
funds

Mitsubishi HC Capital Leasing(Beijing) Co., Ltd.
(Notes 3 and 4)
Mitsubishi HC Capital
Factoring (Shanghai) Co., Ltd.
(Notes 3 and 4)
Mitsubishi HC CapitalManagement (China) Limited(Note 3)

Mitsubishi HC Capital(Thailand) Co., Ltd.
(Notes 3 and 4)
PT. Mitsubishi HC Capital and
Finance Indonesia(Notes 3 and 4)
Mitsubishi HC Capital Energy
Inc.

Norwalk

JakartaChiyoda-ku,
Tokyo¥150 million- 10 -

Leasing ofequipment, etc.
Loans of business
fundsCompany Name

Location

Share Capital

Principal Business(Note 1)

Ownershipor
Ownership
Ratio of
VotingRights(%)

Relationship85.1

Leasing ofequipment, etc.
Loans of business
funds

HSE Ltd.

Hitachi-shi,
Ibaraki¥50 million

JSA International Holdings,
L.P. and its 16 subsidiaries(Note 3)

Cayman Islands
Grand Cayman,etc.

US$742,183
Aviationthousand

100

Loans of business
funds
Debt guarantee

Engine Lease FinanceCorporation (Note 4)

Shannon

US$1 thousand Aviation

100
(100)

Debt guarantee

CAI International, Inc.
(Note 4)

San
Francisco

US$0 thousand Logistics

100
(100)

Debt guarantee

PNW Railcars, Inc. (Note 4)

Portland

US$1 thousand Logistics

100
(100)

Mitsubishi HC Capital Reality
Inc.

Chiyoda-ku,
Tokyo

MHC America Holdings
Corporation (Note 3)

New York

US$0 thousand

Mitsubishi Electric Financial
Solutions Corporation

Shinagawa-ku,
Tokyo¥1,010 million Customer Solutions

Chubu Electric Power & MHC
Germany Transmission GmbH

Dusseldorf

Mitsubishi Auto Leasing
Corporation

Minato-ku,
Tokyo

Environment &Energy¥300 million Real EstateGroup financing
business

100

Loans of business
funds

100

Debt guarantee

45

Leasing ofequipment, etc.

204 other companies(Affiliated companies accounted
for by the equity method)

EUR25 thousand

Environment &Energy49¥960 million Mobility

50

Leasing ofequipment, etc.

Leasing ofequipment, etc.

64 other companies(Other affiliated companies)(Owned)Mitsubishi Corporation(Note 6)

Chiyoda-ku,
Tokyo¥204,446 million

General trading
company

18.40

Mitsubishi UFJ Financial
Group, Inc. (Notes 4 and 6)

Chiyoda-ku,
Tokyo¥2,141,513 million

Bank holding
company

20.03(5.52)(Notes) 1. The “Principal Business” column of consolidated subsidiaries other than MHC America Holdings Corporation indicatesthe name of the reportable segment of the principal business operated by the consolidated subsidiaries. Since MHC America
Holdings Corporation does not belong to any specific reportable segment, the business it operates is presented.
2. As of October 1, 2023, Mitsubishi HC Capital Property Inc. and Mitsubishi HC Capital Community Corporation underwent
an absorption-type merger, where Mitsubishi HC Capital Property Inc. is the surviving company and Mitsubishi HC Capital
Community Corporation is the absorbed company, resulting in the company name changed to Mitsubishi HC Capital Estate
Plus Inc.
3. These companies are specific subsidiaries.
In addition, 3 of the 16 subsidiaries of JSA International Holdings, L.P. are specific subsidiaries.
4. The figure in parentheses in “Ownership or ownership ratio of voting rights” is included the number of indirect ownershipor the ownership ratio of indirect ownership.
5. The percentage of consolidated net sales (excluding internal net sales between consolidated companies) accounted for by
Mitsubishi HC Capital UK PLC exceeds 10%.

- 11 -

Key profit and loss information(1) Revenues¥226,901 million(2) Recurring Income(3) Net Income¥21,017 million¥16,359 million(4) Total Equity(5) Total Assets
6. It is a company that submits annual securities reports.

- 12 -¥201,450 million¥1,535,745 million

5. Employees(1) Consolidated(As of March 31, 2024)
Name of the Segment

Number of Employees

Customer Solutions

2,505

(793)

Global Business

4,131

(296)

Environment & Energy

165

(38)

Aviation229(9)

Logistics

167

(－)

Real Estate

229

(32)

Mobility

294

(102)

Corporate

704

(113)

8,424

(1,383)

Total(Notes) 1. Number of employees includes those seconded from outside of the Group to the Group, excluding those seconded fromthe Group to outside of the Group.
2. The figures in parentheses in the column of the number of employees indicate the average number of temporary employees
employed during the fiscal year under review.
3. The number of temporary employees includes part-timers, temporary employees, and employees on temporary contracts.
4. The names of the reportable segments have been changed from the fiscal year under review. Details are as described in“Notes to Segment Information, etc.” in “1. Consolidated Financial Statements, etc.” of “Item 5. Financial Information.”
5. The number of employees listed as “Corporate” refers to those belonging to administrative divisions that cannot beclassified into specific segments.

(2) Status of Submitting Company
Number of Employees
2,140

Average Age

Average Length of Service

41.3

15 years and 7 months(283)
Name of the Segment(As of March 31, 2024)
Average Annual Salary(Thousands of Yen)
9,772

Number of Employees

Customer Solutions

1,182

(152)

Global Business

49

(3)

Environment & Energy

77

(4)

Aviation

50(5)Logistics

24(－)

Real Estate

42

(2)

Mobility

20(4)

Corporate

696

(113)

2,140

(283)

Total

(Notes) 1. Number of employees includes those seconded from other companies to the Company, excluding those seconded from theCompany to other companies.
2. The figures in parentheses in the column of the number of employees indicate the average number of temporary employees
employed during the fiscal year under review.
3. The number of temporary employees includes part-timers, temporary employees, and employees on temporary contracts.
4. Average annual salary includes bonuses and non-standard wages.

- 13 -

5. The names of the reportable segments have been changed from the fiscal year under review. Details are as described in“Notes to Segment Information, etc.” in “1. Consolidated Financial Statements, etc.” of “Item 5. Financial Information.”
6. The number of employees listed as “Corporate” refers to those belonging to administrative divisions that cannot beclassified into specific segments.
(3) Relationship with Labor Union
Some consolidated subsidiaries have labor unions.
There is nothing to be noted for labor-management relations.
(4) Information on Diversity(i) Initiatives to promote Diversity, Equity and Inclusion
We position the promotion of diversity, equity and inclusion (DEI) as an important management strategy for the further
expansion of the Group’s business domain and global development.
Basic Views
We seek to foster a corporate culture with the vitality to create new value by bringing together diverse talent who canleverage one another’s strengths to maximize the impact of their individual motivations and talents.
Management Message
Mitsubishi HC Capital positions the promotion of DEI as an important management strategy for the further expansion of theGroup’s business domain and global development. We aim to create an environment that brings together talented individuals
with a diversity of knowledge, experience, and attributes so they can leverage one another’s strengths to maximize the impactof their individual motivations and talents.
To realize a workplace environment where diverse talent can exercise their strengths, we hire and promote personnel
regardless of nationality, age, gender, sexual orientation, gender identity, race, or disability. Further, we support theformation of careers tailored to each individual and provide a robust support system to accommodate a variety of work styles,
and strive to foster a supportive corporate culture. Through such efforts, we will continue to advance diversity, equity, andinclusion.
Embracing diversity as a strength
so that all may thrive.
Taiju Hisai, Representative Director, President & CEO Mitsubishi HC Capital Inc.
(ii) Results of Each Indicator for Diversity of the Submitting Company and Consolidated Subsidiaries
Submitting Companies
Fiscal Year under Review
Ratio of Female
Workers inManagement
Positions (%)(Note 1)
16.0

Gender Pay Gap for Workers (%)(Notes 1 and 4)

Ratio of Taking
Childcare Leave forMale Workers (%)(Notes 2 and 3)

All Workers

113.0

67.1

Of which Regular
Workers
65.5

Of which Part-Timers
and Fixed-Term
Workers
65.6(Notes) 1. The figures were calculated based on the provisions of the Act on the Promotion of Women’s Active Engagementin Professional Life (Act No. 64 of 2015).
2. The figures represent the percentage of taking childcare leave, etc. specified in Article 71-4, Item 1 of the“Ordinance for Enforcement of the Act on Childcare Leave, Caregiver Leave, and Other Measures for the Welfareof Workers Caring for Children or Other Family Members (Ordinance of the Ministry of Labor No. 25 of 1991)”
pursuant to the provisions of the “Act on Childcare Leave, Caregiver Leave, and Other Measures for the Welfareof Workers Caring for Children or Other Family Members (Act No. 76 of 1991).”
3. The ratio of male workers, by employment management classification, who have taken childcare leave at Mitsubishi
HC Capital Inc. is as follows: An asterisk “*” indicates that there were no male workers eligible to take childcare
leave.

- 14 -

Career-track positions

113.0%

Business professional*

Business associate*

Because the number of male workers taking childcare leave in a fiscal year other than the one in which their spousegave birth increased, the figure exceeded 100%.
4. For salary, the same standards are applied depending on position and post. Gender pay gap for the same positionand post does not differ. Differences in the average salary for men and women occur due to hiring by position, thenumber of years of continuous service and other factors. We will continue to advance women’s long-term
employment, support women’s career development, and proactively carry out promotions.
Consolidated Subsidiaries (Note 1)
Fiscal Year under Review

Company Name

Ratio of Female Ratio of Taking
Childcare Leave
Workers infor MaleManagement
Workers (%)
Positions (%)(Note 3)(Note 2)

Gender Pay Gap for Workers (%)(Notes 2 and 5)

All Workers

Of which
RegularWorkers

67.4

65.0

Of which PartTimers and
Fixed-Term
Workers

Mitsubishi HC Business Lease
Corporation

11.9

20.0

69.8

DRS Company Limited (Note 4)

30.3

*

–

–

–

MHC Triple Win Corporation

7.7

–

–

–

–

Mitsubishi HC Capital Servicer
Corporation

26.3

–

–

–

–

JAPAN MEDICAL LEASECORPORATION

9.0

–

–

–

–

(Notes) 1. As for consolidated subsidiaries, we disclose indicators released, or scheduled to be released shortly, for domestic
consolidated subsidiaries with 101 or more regularly employed workers as stipulated by the “Act on the Promotionof Women’s Active Engagement in Professional Life (Act No. 64 of 2015),” pursuant to the said act.
2. The figures were calculated based on the provisions of the Act on the Promotion of Women’s Active Engagementin Professional Life (Act No. 64 of 2015).
3. The figures represent the percentage of taking childcare leave, etc. specified in Article 71-4, Item 1 of the“Ordinance for Enforcement of the Act on Childcare Leave, Caregiver Leave, and Other Measures for the Welfareof Workers Caring for Children or Other Family Members (Ordinance of the Ministry of Labor No. 25 of 1991)”
pursuant to the provisions of the “Act on Childcare Leave, Caregiver Leave, and Other Measures for the Welfareof Workers Caring for Children or Other Family Members (Act No. 76 of 1991).”
4. The ratio of male workers taking childcare leave is given as “*” for DRS Company Limited, which indicates that
there were no male workers eligible to take childcare leave.
5. For salary, the same standards are applied depending on position and post. Gender pay gap for the same positionand post does not differ. Differences in the average salary for men and women occur due to hiring by position, thenumber of years of continuous service and other factors. We will continue to advance women’s long-term
employment, support women’s career development, and proactively carry out promotions.

- 15 -

Item 2. Business Overview
1. Management Policy, Business Environment and Tasks Ahead, etc.
The management policy, business environment and tasks ahead, etc. of the Group are as follows.
Forward-looking statements herein are based on the Group’s judgment as of the end of the fiscal year under review.
(1) Basic Management Policy
The Company has established the following “Our Mission,” “Our Vision” and “Action Principles” as its basic management
policy.
“Our Mission” is our long-term goal, “Our Vision” is the objectives to achieve our long-term goal, and the “Action Principles”
are the values and mindset to be held and actions to be taken by each and every employee in order to realize our Mission and
Vision.
◎ Our Mission
Contribute to a prosperous and sustainable future by creating social value through maximizing the potential of
assets.
◎ Our Vision
・ Solve social issues by developing unique and progressive businesses with consideration for the global environment.
・Aim for sustainable growth through value co-creation with diverse stakeholders across the globe.

・Enhance corporate value by evolving our business model through utilizing digital technology and data.

・

Foster an “open, creative and engaging” corporate culture that shapes each and every employee’s motivation andpride.

・

Aim to be a trusted company by complying with laws and regulations, as well as implementing ethical corporate
management.

◎ Action Principles
・ Challenge: Challenge ourselves to look forward to the future with a sense of responsibility and commitment.

・ Digital: Drive digital innovation and expertise.

・ Communication : Communicate openly and honestly to build mutual understanding and trust.
・ Diversity: Embrace diversity and respect each other.

・ Sustainability: Act in harmony with people, society and the earth to create a sustainable world.

・ Integrity: Maintain the highest standards of ethics and integrity.

- 16 -

(2) The Company’s Management Strategy in the medium to long Term and Issues to be addressed(i)Business Environment
In recent years, there have been drastic changes in the external environment and there is an increasing need to recognize
megatrends, or the trends influencing domestic and international economies over the medium to long term, such as
geopolitics and the economy, climate change, expansion and evolution of technology, demographics, and wealth disparities.
In these changes to the external environment, the roles required of the Group are changing to better resolve social issues
through business investment and operation, in addition to conventional leasing and finance. Further, business models at anindustry level are expected to change rapidly at a speed which has exceeded all expectations. In such circumstances that allcompanies are to adapt to the environmental changes, the prominence of the Group, holding various asset-related functions
and offering flexible services which are not limited to financial functions, will increase further.
In light of these circumstances, the Group formulated a Medium-term Management Plan covering the three-year period
from the fiscal year ended March 31, 2024 (“2025 MTMP”), which was announced in May 2023.

(ii) The Direction the Group should take and the Outline of the 2025 MTMPThe Group has established Our 10-year Vision, “Together we innovate, challenge and explore the frontiers of the future.”
In order to achieve this vision, we are proceeding with the evolution and layering of business models by developing services
and promoting business investment, utilizing tangible and intangible assets such as data and other elements, to their fullest
potential.
For the promotion of the above, we will aim for sustainable growth by solving environmental, social, and economic issues.
At the same time, we will aim to enhance our medium- to long-term corporate value by achieving an optimal balance sheet
based on well-balanced growth potential, return on capital, and financial soundness.
The 2025 MTMP is positioned as the “hop” plan of our three Medium-term Management Plans (“hop,” “step,” and “jump”)
toward Our 10-year Vision. We address the management plan with “sowing seeds” and “gaining a solid foothold” leading
to a leap to the “step” and “jump” plans as keywords.
 We will achieve “Our 10-year Vision” by implementing Medium-term Management Plans in three phases. The 2025 MTMP which started in FYE3/2024 is set
as phase one, “hop,” followed by the Management Plans as phase two, “step,” and phase three, “jump.”
 Our targets for FYE3/2026, the final fiscal year of the “hop” phase, are net income of ¥160 billion, ROA*1 of approx. 1.5% and ROE*2 of approx. 10%. The
target payout ratio for the period of the 2025 MTMP is 40% or more. (ROA and ROE are based on net income attributable to owners of the parent)

Together we innovate, challenge and explore the frontiers of the future

Our
10-year
Vision To achieve our mission, continue to be an “innovator (who ventures into unexplored fields
and creates innovation)” who challenges the frontiers of the future without being bound by
precedents.
 Anticipate the changes in society and the business environment including changes in global
industrial structures, accelerating digitalization and increasing importance of sustainability,
and continue addressing social issues that can be solved only by MHC through approaches
such as SX (sustainability transformation) and DX (digital transformation) with customers andpartners.

1stMedium-term Management Plan

2nd
Medium-term Management Plan

3rd
Medium-term Management Plan

Hop

Step

Jump

FYE3/2022

FYE3/2023

FYE3/2024

FYE3/2026¥99.4 bn

¥116.2 bn¥123.8 bn¥160.0 bn
Approx. 1.5%

Net income
ROA

1.0%

1.1%

1.1%

ROE

8.0%

8.2%

7.7%

Approx. 10%

Payout Ratio

40.4%

40.8%

42.9%

40% or more

*1 ROA: Return On Asset*2 ROE: Return On Equity- 17 -

FYE3/2029

FYE3/2032

(iii) Business Strategies
Business Types
The Group classifies its businesses into the five types below, and will proceed with the “evolution and layering of businessmodels” to achieve business portfolio transformation.
Business Type

Direction

ExamplesRisks and returns are relatively
higher than ① and ②, so we will
increase the size of asset
utilization business in a phasedmanner in consideration of risk
capital, etc.

• Non-FIT renewableenergy businesses• Real estate
revitalizationand development
investment

Utilize data to develop
platform businesses, andmainly acquire service revenue

The initiative for this business isdifficult and will take time togenerate profits. However, it will
help differentiate MHC fromcompetitors, so we will actively
plant seeds for this domain• Inventory optimization
services utilizing data
• Sharing services
utilizing data

③ services

Add maintenance services,AM*5, etc. mainly to ②, andacquire service revenue aswell as income gain and capitalgain

Promote the shift mainly from ②(add services) to increase
profitability• Operating leases withmaintenance services• Service solutions suchas asset management

Asset② finance

Investment and lending mainlyin specific marketable general
purpose assets backed by thevalue of business assets.
Capital gain as well as income
gain can be acquired

A profit base which generates stable
cash flows. However, some assets
have relatively low risk but yield low
returns, so we aim to increase
profitability by reducing lowprofitability assets and evolving into
an O&D business• Operating leases• Real estate
securitization

Acquire income gain morestably and continuously
through corporate financing

Same as ②. However, risks andreturns of this business are both
lower than ②, so we will take drastic
action to increase profitability(accelerating the reduction of lowprofitability assets, promoting
efficiency improvement, etc.)• Finance leases• Vendor leases• Installment sales• LendingAsset⑤ utilization
Evolution and Layering of Business Models

Business Characteristics

businessDatautilization④ platform
services
Finance +Customer① finance

Promote business investment
utilizing assets, aiming tomaximize revenue from thosebusinesses

Risk

ReturnMedium risk andmedium returnLow risk andlow return

Vision of the Evolution and Layering of Business Models
We will proceed with the evolution and layering of business models by simultaneously working on the enhancement of the
profitability and efficiency of existing businesses, shifting existing businesses to high value-added services, and developing
new businesses.

- 18 -

Enhance Profitability and Efficiency of existing Businesses① Customer finance and ② asset finance are positioned as profit bases for creating stable cash flows from their firm customer
bases. On the other hand, given that returns on some assets are relatively low, in addition to strengthening their profitability,

we will steadily promote the reduction of low-profitability assets.



Shift existing Businesses to high value-added Services

We will maintain and expand our ① customer finance and ② asset finance customer bases and shift these existing businesses
to high value-added services—namely ③ finance + services and ④ data utilization platform services—and increase theirreturns by improving customer experience.



Develop new Businesses

We will proceed with the development of ④ data utilization platform services, ⑤ the asset utilization business, and othernew businesses, and focus on these new businesses as the pillars of medium- to long-term profit growth, in addition to ③
finance + services.
Premise for Business Strategies
We will achieve profit growth by transforming our business portfolio and the quality of our assets in the medium to longterm through the evolution and layering of business models. To this end, we will actively invest cash flows from a mediumto long-term perspective after paying dividends.
For the purpose of supporting this effort, we will achieve medium- to long-term return on capital and financial soundness
by optimizing our balance sheet, and then maximize our corporate value.

- 19 -

Business Strategies by Segment
The direction of the business strategies by segment is as follows.
Segment

Direction of Business Strategies

Customer Solutions

・ Enhance profitability by launching many new services for which we haveconducted PoC*1 with each partner company.
・ We will accelerate the evolution and layering of business models by creating
various solutions that help us provide added value to customers and resolve their
management issues, and promoting internal collaboration on and thedissemination of such solutions.
・ Reform sales processes by improving accuracy and efficiency of sales activities
through the development/usage of a new customer information management
system and the reallocation of human resources.

Global Business<Europe>・ Promote the accumulation of high-quality new assets in the decarbonization
domain and other businesses as well as profit expansion strategies, such as anincrease in gains on sales of used cars.
・ Expand interest rate fees by reducing funding costs, etc.
<Americas>
・ Expand fees based on an improved interest rate environment as well as throughinitiatives such as revising pricing standards, etc.
・ In the sales finance business for commercial trucks, review the models andprocesses to control credit risks in consideration of third-party assessments.
・ Diversify and restructure our business portfolio to achieve appropriate risks andreturns.

Aviation・ Enhance profitability by strengthening coordination between the aircraft/aircraft
engine leasing, engine parts sales,*2 and Japan businesses.
・ Stably expand the high-quality portfolio through M&A and other measures.
・ Expand businesses and services aimed at realizing a decarbonized society.

Logistics

・ Accumulate transactions by executing more new investments in the container
leasing business, and maintain high utilization rates by further sophisticating
operations.
・ Acquire highly profitable and long-term transactions in the North America
freight railcar leasing business and continue to generate gains on sales bystrengthening O&D (Origination & Distribution) operations.

Environment & Energy

・ Further expand our domestic power generating capacity (solar, wind, etc.)(targeting over 1,000MW by the end of FY2024).
・ Accelerate sales of domestic solar and biomass power generation businesses inwhich we have a minority stake.
・ Develop renewable energy power generation businesses in Europe throughEuropean Energy A/S (a company developing and operating renewable and nextgeneration energy businesses), in which we acquired a 20% stake in April 2024.

Real Estate

・ Increase profit generated during leasing terms by enhancing development andadding value in Japan and continue to generate gains on sales of assets.
・ O&D*3 in domestic finance businesses and restructuring of the Division’s
portfolio.
・ Reduce losses and collect the maximum amount of debts in problematic U.S.
projects.

Mobility

・ Expand domestic and overseas EV integrated services.
・ Reduce costs and strengthen sales capabilities from the merger of the twodomestic auto leasing companies.

*1

PoC (Proof of Concept): Verification of feasibility of new ideas and technologies.

*2*3

Engine parts sales: A business that dismantles used engines and sells the individual parts.
O&D (Origination & Distribution): A business model for real estate non-recourse loans aiming to increase profitability
through sales or sub-participation of loans in part to external parties such as by dividing loans into senior loan portions
and subordinated loan portions.

- 20 -

Key Themes across Segments
We have defined the themes below to be addressed with the concerted efforts of the Group across segments.
These themes will lead to our goal of contributing to a prosperous and sustainable future by creating social value withpartners, not by the Group alone.
Future vision
HydrogenAs a leading holder of renewable energy power sources in Japan, contribute tobuilding a hydrogen supply chain with green hydrogen production at the core.

EVs

Contribute to realizing a carbon-neutral society based on EVs.

Logistics

To address social issues and customer needs in logistics supply chains, develop andprovide optimal logistics solutions by collaborating with leading partners and thereby
achieve a full line-up of logistics services.

Decarbonization Solutions

Evolve into an integrated service provider to realize a decarbonized society.

(iv) Corporate Functions Strategies
We enhance our corporate functions centering on the four strategies below.
Major Initiatives for the 2025 MTMP
Fostering and Securing Talent Enhance employee engagement by utilizing surveys, etc.
 Develop a talent portfolio contributing to the achievement of management
strategies.

Bolstering the Financial Baseand Internal Organizational Base Strategically disclose human capital.
 Procure stable and competitive funds, expand funding capacity and enhance the
ALM* framework.

 Redevelop frameworks for credit examination and management in response tobusiness portfolio transformation.
Strengthening the Corporate
Governance Framework

Enhancing Stakeholder
Engagement

 Develop optimal IT systems responding to new businesses and business models.
 Promote group-wide unified management by strengthening the consolidated
management framework.
 Enhance integrated risk management in response to business advancement andchanges.
 Develop a framework for unified management of internal auditing on a global
basis.

 Enhance financial and non-financial information to be disclosed and diversify
means to dispatch information.

 Enhance communication with external stakeholders.
 Promote and strengthen efforts for sustainability.
* Asset Liability Management: Comprehensive management of assets and liabilities(v) Frameworks to promote transformation
We will eliminate obstacles to achieving transformation, and change our way of thinking for transformation.
We will speedily promote various initiatives from new perspectives and not simply stay on conventional paths.
Direction of Initiatives
1“Lay” the Foundation of Foster all employees’ awareness of transformation.
Transformation

2“Create” Transformation

Develop frameworks so that efforts contributing to transformation can be actively
launched.

3“Promote” Transformation

Develop an agile discussion framework and promote transformation by advancing
efficient decision-making processes and the delegation of authority that comes withresponsibility, etc.

(3) Business Issues to be addressed as a Priority MatterIn order to achieve Our 10-year Vision, the Group proceeds with the “evolution and layering of business models” by promoting
services and business investment, utilizing tangible and intangible assets such as data and other elements, to their fullest
potential.

- 21 -

It is considered necessary to transform the awareness of each employee in order to progress the “evolution and layering ofbusiness models.” As a mechanism for this, we will build the “frameworks to promote transformation.” As the “frameworks
to promote transformation,” we implement measures from three angles of “laying the foundation of transformation,” “creatingtransformation,” and “promoting transformation,” and execute the measures from new perspectives that are not an extensionof the past.
Further, the 2025 MTMP is positioned as the “hop” plan of our three Medium-term Management Plans (“hop,” “step,” and“jump”) toward Our 10-year Vision, and we strategically implement to contribute to the “sowing seeds” and “gaining a solid
foothold” that will lead to the leap towards the “step” and “jump” plans, including transforming the awareness of employees
towards reform.
(4) Target Performance Indicators
The Company will aim to achieve the following financial and non-financial targets during FY2023 to FY2025 (from the fiscal
year ended March 31, 2024 to the fiscal year ending March 31, 2026), which is the period that is the subject of the 2025
MTMP.
<Financial Targets>
Item

Targets

Financial Targets(End of FY2025)

Dividend Policy(2025 MTMP Period)

Net income attributable toowners of the parent¥160.0 billion (CAGR vs. FY2022: +11.2%)

ROA

Approx. 1.5% (vs. FY2022: Approx. +0.4 pts)

ROE

Approx. 10% (vs. FY2022: Approx. +1.8 pts)

Payout ratio: 40% or more

 As a general rule, return profits to shareholders by paying
dividends.

 Increase the total amount of dividend payment through profit
growth.
Financial Soundness(2025 MTMP Period)

Maintain A ratings

 Establish both a sound financial base and an active investment
strategy.

 Maintain current stand-alone ratings*.
(Note) Net income attributable to owners of the parent is used for the calculation of ROA and ROE.
* Credit ratings for the Group on a stand-alone basis without external support.
<Non-financial Targets>
KPI

Targets (2025 MTMP)

Level of fulfillment of a talent portfolio inline with our management strategies (nonconsolidated)

Formulate the talent portfolio framework and visualize the level offulfillment.

Results of the employee engagement survey(non-consolidated)

Refine the survey content, enhance analysis.

Employee ratio of “standard” level or higher
in DX assessments*1 (non-consolidated)

80% or more

Monthly average overtime hours (operational 14 hours or lessefficiency) (non-consolidated)
Rate of annual paid holidays taken by
employees (non-consolidated)

70% or more

GHG emissions amount (Scope 3*2)
(consolidated)

Analyze the categories which have a major impact and visualize Scope 3*2
emissions.

GHG emissions amount (Scope 1*2, 2*2)
(consolidated)

FY 2030: -55% compared to FY 2019
FY 2050: net zero

Energy consumption (domestic) (nonconsolidated + domestic Group companies)-1% YoY continually.

*1

DX assessment: A tool provided by an external vendor for measuring levels of DX literacy. Employees are categorized
into three levels: beginner, standard, and expert.

*2

Scope 1: Direct emissions of GHG from the business operator itself (fuel combustion, industrial processes)
Scope 2: Indirect emissions associated with use of electricity, heat, and steam supplied by other companies.

- 22 -

Scope 3: Indirect emissions other than Scope 1 and Scope 2 (other companies’ emissions related to the business
operator’s activities)- 23 -

2.

Concept and Efforts for Sustainability
Forward-looking statements herein are based on the Group’s judgment as of the end of the fiscal year under review.
(1) Basic Views on Sustainability
The Company believes that efforts toward sustainability—among them, protecting the global environment, respecting humanrights, and embracing diversity—are an essential responsibility to society that corporations should fulfill. To continue tosurvive, corporations must pursue long-term growth while gaining the trust of their stakeholders by engaging in businessactivities that seek to resolve environmental, social, and economic issues.
(2) Materiality (material Issues)
Mitsubishi HC Capital has identified the following six materiality as priority key challenges which must be addressed toachieve sustainable development of Mitsubishi HC Capital Group.
Against a backdrop of megatrends such as recent climate change driven by global warming, population growth, urbanizationand scarcity of resources, not only our personal life but also social environment have been drastically changing worldwide.
Under such circumstances, companies are expected to take efforts to solve numerous issues, such as to promote a decarbonizedsociety and to create a circular economy.
The Group proceeds its effective management and business activities toward solving such issues based on the materiality withappreciating the significance.

Materiality of the Group
Materiality

Why the Group treats as highly material Challenges

Promote a decarbonizedSociety Efforts to realize a decarbonized society have been globally

Realize the circular
EconomyEstablish resilient social
Infrastructure

Realize healthyLifestyles that promote
positive Wellbeing

recognized as an urgent issue, and the Group can significantly
contribute to solving this challenge through its service andsolutions, such as renewable energy investment and EV
promotion.
 It is quite a few impact on but is significant for the Group to
distinct its business from the business not solving social
issues.
 The Group aims to contribute to creating a circular economy
by reducing waste, not only in the Group but also withinsociety through maximizing the potential of assets as aleading leader in the leasing industry. The Group treats thischallenge as material.
 The Group can also contribute to realizing a sustainable andprosperous society through strengthening the collaboration
between partners.

 Large parts of the infrastructure within Japan needs to be
repaired. The Group also recognizes the business has huge
potential opportunities to support the development of
infrastructure in overseas countries with active collaboration
between various partners and create a smart city.
 The Group will contribute to the business being diversified,enhanced and efficient through establishing the system andproviding services for supporting the collaboration of various
companies.
 It is vital for its stakeholders that the Group recognizes theimportance of health, safety, mental and physical wellbeing
for realizing the prosperous future.
 Valuable human resources are key. Personal development andattraction and retention of talent is significant for the Group
members.

Create Businesses Both financing for the purpose of digital transformation ofutilizing the latest
Technologies

customers and providing solution by internal and external- 24 -How related to SDGs

Materiality

Why the Group treats as highly material Challenges

How related to SDGs

digital technologies boost development of new businessmodels.
 Including establishing supply chain with utilizing with new
alternative energies, the Group identifies material one as theopportunity.
Collaborate with
 Social issues differ by countries and regions. It is significant
that the Group aims to solve these issues by collaborating
Partners locally andwith local partners to ensure the Group is meeting individualglobally
needs through local community-based communication.
 The Group can realize mutual benefits in developing society
by utilizing the integrated capability in the Group.
* Please refer to the website regarding how the Company identified the materiality.
https://www.mitsubishi-hc-capital.com/english/sustainability/materiality.html(3) Basic Sustainability Policy
The Company has been building partnerships with numerous stakeholders globally and has considered itself to have the huge
potential capability to contribute and solve social issues. The Company established “Our Mission” to create social value withcustomers and partner companies and to contribute the prosperous and sustainable future as its ideal image, and defined “Our
Vision” as what is required to achieve it. The Basic Sustainability Policy consists of and integrates “Our Mission,” “Our
Vision” and the materiality.
In particular, we are promoting the appropriate disclosure of information related to initiatives on climate change as part ofpromoting a decarbonized society, which is one of the materialities set by the Company, and related to initiatives oninvestments in human capital that aim to resolve the materiality.
How Materiality relates to “Our Mission” and “Our Vision”(4) Addressing Climate Change
Climate change is a major challenge that needs to be resolved in order for a sustainable society become a reality. The Group
believes that for any company to survive moving forward, it must work to solve this problem through its business activities.
Furthermore, the Group is aware of the importance of earning the trust of stakeholders through proper disclosure of
information, and supports the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD).
Information Disclosure according to Four Disclosure Items suggested by TCFD Recommendations(i)

Governance
The Group has established the Sustainability Committee to better contribute to the realization of a sustainable and prosperous
future. This Committee is one of the advisory bodies to the Executive Committee and meets to discuss the climate change- 25 -

issue and other key challenges related to sustainability. The results of the deliberations are reported to the Executive Committee
and the Board of Directors. The material issues that include promotion of a decarbonized society were identified throughdeliberations by the Sustainability Committee, Executive Committee, and Board of Directors. The Group will promote efforts
to identify and manage the impact of climate change on business and reinforce its governance.
(ii) Risk Management
Regulatory changes, technological innovation, shift in business models in line with the transition to a decarbonized society or
extreme weather, etc. stemming from global warming may affect our operating results and financial position in the form ofbusiness failure of business partners due to earnings deterioration and other factors, decline in value of assets owned by theGroup, and others. The Group recognizes climate change risk as one of the critical risks in company-wide risk management,
and while identifying, assessing and managing the risk, will regard this as a business opportunity and contribute to realizing
a decarbonized society.
a.

Risk Management System Overview

The Group uses the “integrated risk management” framework to comprehensively manage risks to primary businesses that
could have a substantial impact on investors’ decisions.
The important risks managed within the integrated risk management framework include, but are not limited to, credit risks,
asset risks, investment risks, market risks, liquidity risks, and operational risks.
To manage envisaged risk factors, the departments overseeing specific risks monitor issues arising from developments in theexternal environment or other changes, regularly consider measures to address such risks, and then report and deliberate themat meetings of each committee including the Risk Management Committee. In addition, we operate a risk management system
in which important matters are reported to and discussed by the Executive Committee and the Board of Directors. For detailsof the risk management system, please refer to “Item 2. Business Overview, 3. Business and Related Risks.”b.

Classification and Example of Impacts of Climate Change Risks

Climate change risks consist of transition risks associated with climate-related regulation tightening and technologicalinnovation, etc. and physical risks associated with extreme weather and changes in climates. The TCFD recommendationsclassify these risks into subcategories of policy and legal/technology/market/reputation, and acute/chronic, and show examplesof impacts.
The Company recognizes that impacts of climate change risks occur in various time frames such as short, medium and longterm through broad transmission routes including existing risks like credit risks, asset risks and investment risks. Furthermore,in addition to direct impacts on the Company’s business activities, the onset of indirect impacts through the Company’s
customers is also possible.
Based on such risk characteristics and details of the TCFD recommendations, the Company sorts out examples of impacts ofclimate change risks for each of its major risks, also taking into account its risk management framework. Under the integrated
risk management system, the Company is also advancing the establishment of a system to identify/assess and manage climatechange risks in light of relations with other major risks.
Going forward, the Company will review the risk classification and examples of impacts according to changes in external
environment, and deepening of analysis and assessment of climate change risks.
c.

Status of Integration into overall Risk Management

Various impacts of climate change risks on other major risks are reported to and discussed by the Risk Management
Committee. We will advance integration of such risks, including risks identified through scenario analysis, in overall risk
management by establishing a monitoring system and other means. In addition, development of targets and plans related toclimate change and details of monitoring are reported to and discussed by the Sustainability Committee. Details of discussionsof both committees are reflected in the Company’s management strategies under the system of monitoring by the Board of
Directors so that we can appropriately address the risks from both perspectives of overall risk management and individual
risks.
(iii) Strategy
The Company identifies risks and opportunities brought by future climate change to the Group, and conducts scenario analysis
on “transition risks” and “physical risks” for the purpose of appropriately disclosing information and considering future
measures.
The scenario analysis is carried out based on limited information and data available at present. We will strive to reflect theanalysis in appropriate disclosure by carefully interpreting the results of this analysis, continuing to obtain more information- 26 -

and relevant data through dialogues with stakeholders, and promoting refinement of analysis methods and expansion ofbusinesses to be analyzed.
a.

Overview of the Scenario Analysis

Overview of Transition Risk Analysis
Target Sector and main Segment

Target Sector
Energy(Oil and Gas, Coal and Electric Utilities)

Main Segment
Environment & Energy

Transportation (Air Freight and Passenger Aviation
Air Transportation)
Materials and Buildings (Real EstateManagement and Development)

Real Estate

Scenario

Net Zero Emissions by 2050 Scenario (NZE scenario) and Stated Policies Scenario(STEPS scenario) published by the International Energy Agency (IEA)

Analysis Method

Identify opportunities and risks for a decarbonized society in target sectors and assessbusiness impacts (qualitative analysis)

Overview of physical Risk Analysis
Analysis Subject

Assets for business possessed by the Environment & Energy Business Division, theReal Estate Business Division, and the Group’s offices and branches

Scenario

Shared Socioeconomic Pathways (SSP5-8.5) published by the Intergovernmental Panelon Climate Change (IPCC)

Analysis Method

Assess business impacts of extreme weather and changes in climates that can occur atthe locations of assets for business (qualitative analysis)b.

Results of the Scenario Analysis

Each headquarters in charge of Environment & Energy, Aviation, Real Estate, and Customer Solutions, which are segments
subject to implementation of the scenario analysis, and the Risk Management Department, a department in charge of companywide overall risk management, discussed the Company’s business impacts of climate change and confirmed consistency
between results of the scenario analysis and the existing strategic policy.
The Group endeavors to minimize risks and maximize opportunities by taking short- and long-term measures as for risks andopportunities related to climate change. As results of the transition risk analysis, the need to appropriately handle risks andopportunities associated to expansion of renewable energy (Environment & Energy), shift to low mileage aircraft/engines andlow-carbon fuels such as SAF and hydrogen (Aviation), growing demand for low-carbon buildings (Real Estate), etc. havebeen recognized. Furthermore, as results of the physical risk analysis, risks including damage caused by disasters to power
stations and deterioration of power generating facilities such as solar panels (Environment & Energy), loss in value of realestate due to intensification of natural disasters and increases in construction/operation expenses and renovation costs (Real
Estate), damage caused by disasters to the Group’s offices, and increases in operating expenses and insurance costs have been
anticipated.
While appropriate countermeasures for climate change risks have been developed, acquisition of business opportunities has
been incorporated in strategies as for opportunities brought by climate change. Going forward, we will reflect KPIs related toclimate change in the process of implementing the Medium-term Management Plan, and establish a system to regularly
monitor relevant trends in Japan and abroad, and the status of initiatives of the Group.
(iv) Metrics and Targets
Based on the recognition that efforts to realize a decarbonized society are an urgent issue, we will set the Group’s greenhousegas reduction targets pursuant to the Paris Agreement, and we promote the transition to a decarbonized society. In the casewhere greenhouse gas emissions increase significantly in the future due to efforts for new businesses, or where numericalvalue changes while calculation of greenhouse gas emissions of the entire Group including supply chains are sophisticated,and other cases, the established targets may be reviewed appropriately, but we plan to set the targets so that any targets are inline with the level of the Paris Agreement, just like the targets established at present.

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a.

The Group’s Targets for Reduction of Greenhouse Gas Emissions

Scope 1 and Scope 2

Short Term (Every Year)

Long Term (to Fiscal 2050)-55% compared to fiscal 2019 Net zero

Energy usage in Japan:-1% compared to the priorfiscal yearb.

Medium Term (to Fiscal
2030)

Future Efforts

For the Group’s property leasing and aircraft leasing transactions (Scope 3 - Category 13, Downstream leased assets) and realestate investment transactions (Scope 3 - Category 15, Investments) that are thought to involve greenhouse gas emissions, we
also consider the measurement method and conduct discussions toward disclosure.
Going forward, we will promote reduction of greenhouse gas emissions of the entire Group including supply chains throughformulation of the policy for sectors with high greenhouse gas emissions and the transaction plan, and other means.
(5) Initiatives on Investments in Human Capital(i)

Direction of Strategies
The Group recognizes that accumulating and utilizing human capital is an important issue to improve corporate value throughrealization of the “basic management policy” and “medium- to long-term management direction.” In particular, to realize“SX/DX” and “business portfolio transformation” shown in the “medium- to long-term management direction” and achieve
performance indicators at which the Group aims, it will secure and utilize necessary human capital in terms of both quality
and quantity.

(ii) Themes that We want to accomplish
In securing and utilizing human capital (qualitative shift in human resources and securing of the quantity of human resources)
we uphold two themes to be accomplished in the medium to long term.
What we want to accomplish (a)Fulfillment of a talent portfolio
Develop and secure humanresources contributing to theCompany’s realization ofstrategies (quality and quantity)

We define quality and quantity of human resources necessary to realize the “mediumto long-term management direction” and visualize a talent portfolio.
We understand a gap between necessary human resources and current humanresources in terms of quality and quantity, and implement measures for filling the gap
to supplement necessary human resources.

What we want to accomplish (b)The Group defines “MHC engagement” as a situation in which employees work
Maintaining and improving MHC together in pursuit of value creation. We will work to maintain and improve
spontaneity (a situation in which employees can work using their own discretion),engagement
diversity (a situation in which diversity among employees leads to cross-fertilizationof ideas), and a positive workplace environment (in which employees can exercise
their spontaneity and diversity to the full), which are the three elements comprising
MHC engagement.
(iii) Details of Initiatives
The two themes that we want to accomplish as priorities are the reconstruction of the human resource management based, andthe creation of a system for maintaining and improving MHC engagement.

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Details of Initiatives
Reconstruction of the Human
Resource Management BaseThe Group has collected/accumulated information on human resources and used it for
utilization of human resources (allocation and development) to date.
Going forward, for “What we want to accomplish (a) fulfillment of a talent portfolio,”
we will reconstruct the human resource management base, define types of humanresources necessary to realize the “medium- to long-term management direction,” andthen further understand human resources and conduct the human resource developmentthat contributes to qualitative shift.
In understanding human resources, we handle qualitative factors such as experience,
knowledge, skills and competency in addition to the quantitative perspective including
the number of employees. In human resource development (qualitative shift), we
identify qualitative issues to fulfill a talent portfolio and take measures for capacity
development.
Moreover, we will improve the accuracy of matching between human resources andjobs by also putting in place information on jobs, in addition to information on humanresources, systematically to further ensure that the right people are placed in the rightjobs.

Creation of a System for
maintaining and improving
MHC Engagement

The Group has identified current issue areas by survey, and implemented improvement
activities to date.
Going forward, we will create an index for MHC engagement and work to maintain andimprove it. Maintaining MHC engagement for the Group as a whole at a high level will
also result in securing the desired number of human resources.

(iv) Metrics and Targets
We have set visualization of the level of fulfillment of the talent portfolio and enhancement of the analysis of the results ofthe engagement survey as non-financial targets for our Medium-term Management Plans. However, we will disclose numericaltargets for the engagement survey and the level of fulfillment of the talent portfolio at the time of FY2024 results and theannouncement of FY2025 results, respectively.

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3. Business and Related Risks
The Mitsubishi HC Capital Group comprehensively manages the main items of the business and related risks that may potentiallyhave important impact on investors’ decisions using the framework including Integrated Risk Management. The Group has
established an appropriate system to manage these risks and strives to prevent them from emerging or to minimize their impact ifthey occur.
Furthermore, to manage these potential risk factors, we operate a system whereby the division responsible for the relevant area ofrisk monitors and identifies issues arising from changes in the external environment and other factors. Each of these divisions holds
regular discussions to review appropriate response measures and reports promptly to the Executive Committee, a consultative anddecision-making body that controls the execution of business. Specifically, in addition to the Risk Management Committee thatcomprehensively and systematically manages risks related to overall management, the Asset Liability Management (ALM)
Committee, Compliance Committee, and other committees meet quarterly or as necessary to discuss the issues surrounding andmeasures to address individual risks. Additionally, important matters at each committee are reported to and discussed by the Boardof Directors.
The forward-looking statements herein are based on judgments made by the Group as of March 31, 2024.

(1) Integrated Risk Management
Mitsubishi HC Capital engages in business operations that incorporate the framework of integrated risk management in order
to work toward sustainable growth by balancing maintenance of management soundness with improving profitability. The
major risks managed within the framework of integrated risk management include credit risk, asset risk, investment risk,
market risk, liquidity risk, and operational risk. Risk management is conducted on a consolidated basis.
Specifically, risk capital is allocated to the respective risk category based on the Company’s risk capital management policy
after quantifying each risk using risk assessment methods tailored to the characteristics of the asset or business. Reasonablerisk-taking is then carried out within the scope of risk tolerance.
Within this risk management framework, regular monitoring is undertaken of the utilization of risk capital and the status of
portfolios, the results of which are reported to and discussed by the Risk Management Committee, the Executive Committee,
and the Board of Directors. In this way, efforts are made to ensure appropriate response measures and to promote effective
internal communication about risk. Arrangements are in place to ensure that the Board of Directors is fully informed of therisk management system and risk management status and that it maintains oversight thereof.

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(2) Major Risks Managed within Framework of Integrated Risk Management
The Mitsubishi HC Capital Group conducts business activities globally. The Group provides capital investments and services
necessary for customer businesses through leases and other means. The assets it holds for leases and related transactions arediversified, ranging from general movable property such as office equipment and production equipment to assets, such as
aircraft, that are used in particular industries. Demand for capital investment can decline considerably if a customer’s businessenvironment deteriorates with deceleration or slowdown in business at home or abroad. In that case, a decline in leases andother transactions could impact the Group’s business results and financial position. Additionally, losses arising frominadequacy of internal processes, personnel, or systems or their failure to function, or exogenous events could impact theGroup’s business results and financial position.
The major items among these envisioned risks are managed within the framework set out under (1) Integrated Risk
Management.
(i)Credit Risk
The Mitsubishi HC Capital Group conducts business that extends credit over the medium to long term through leases,
installment sales, monetary loans, and other financial services of various forms. Depending on future business trends andthe financial landscape, additional provisions of allowance for doubtful receivables could be necessary with increasing nonperforming loans due to deterioration in a company’s credit status, which could impact the Group’s business results andfinancial position. Furthermore, because the Group is engaged in business globally, it is subject to country risk in which
losses may arise depending on the political and economic situations in the countries and territories where customers andinvestees are located.

[Main Efforts to Address Risk]
When considering the advisability of each deal, the Group carefully reviews the customer’s credit standing using its own
rating system and makes a thorough study in light of the value of the leased property, country risk, and other factors in aneffort to ensure a reasonable return for the risk. Additionally, the Group continues to check the customer’s credit standing on
an ongoing basis even after entering into business relations and has a system in place to take the necessary steps in the eventthat the customer’s credit standing worsens. Moreover, it engages in credit management with respect to the portfolio as awhole and considers risk diversification to ensure that credit is not concentrated with a specific customer, industry, country,
territory, and so on, while striving to ensure sound management by regularly measuring the credit risk of its portfolio andmonitoring to ensure that it is within a certain scope of capital.
(ii) Asset Risk
In addition to general movable property, the Mitsubishi HC Capital Group holds such global assets as aircraft and real estate,including buildings, and conducts a business leasing these assets in and outside Japan in the form of operating leases andothers. In this business, the Group is exposed to asset risk in addition to the aforementioned credit risk, so fluctuation inrevenue from asset management and disposals could impact the profitability of the leases. For this reason, when engaging inoperating leases, the Group carefully assesses the future value according to asset type in addition to the customer’s credit
standing before working on each deal. Even after entering into business relations, the Group continues monitoring the status- 31 -

of the leasing and secondary markets for said assets along with the status of asset use by the leaseholder, striving to prevent
risks from emerging or to mitigate their impact if they occur.
a.

Global Assets
The Group holds global assets such as aircraft and aircraft engines, containers, and railway cars and conducts a businessleasing these assets in and outside Japan in the form of operating leases and others. In the business related to global assets, theGroup is exposed to price fluctuation risk pertaining to said assets in addition to the aforementioned credit risk. With operatingleases, in addition to lease fee revenue received from the customer, the Group recovers funds by selling the asset at the end of
the lease period. Additionally, in the event of a customer bankruptcy, the Group takes the asset back and recovers funds byleasing it to a different customer or selling it. As for selling assets, in addition to business trends and the financial landscape,major incidents arising from technical problems, obsolescence due to technological change, revisions to laws and regulations,increased concern over global pandemics or terrorism, natural disasters, war, or geopolitical risk may render the asset
irrecoverable or cause its selling price to fluctuate. Furthermore, the recording of an impairment loss or increased costs
associated with property management could also impact the Group’s business results and financial position.
[Main Efforts to Address Risk]
When engaging in operating leases with global assets, the Group conducts a comprehensive review that includes a checklist
for deals involving movable property and future asset liquidity before working on each deal and endeavors to ensure areasonable return for the credit risk and asset value fluctuation risk. Furthermore, the Group has established internal criteria
to maintain a portfolio with risk diversification taken into account, including asset types, regions, and time of expiration.
Moreover, the Group continues to check the customer’s credit standing and industry trends on an ongoing basis even after
entering into business relations and has a system in place to take the necessary steps in the event that the customer’s credit
standing worsens, such as collecting a deposit from the customer to cover asset wear and tear as necessary. Additionally, theGroup holds warning sign management meetings as necessary at business divisions and risk management divisions for eachmajor asset category to review applicable industry trends and signs of problems that could impact asset value fluctuation. The
Group also regularly measures customer credit risk and the risk of fluctuations in the value of assets in its portfolio to monitor
whether it is within a certain scope of capital, in an effort to ensure sound management.

b.

Real Estate
The Group is engaged in and outside Japan in investment in and financing of commercial real estate such as offices, residences,
commercial facilities, logistics facilities, and hotels, and in leasing and other business operations based on its portfolio of
owned properties. These assets are subject to revenue fluctuation risk and price fluctuation risk. In the real estate-related
business, in addition to lease fee revenue from tenants, the Group recovers funds by selling those assets that are not long-termholdings at the right time. Lease fee revenue and revenue from sale of assets may fluctuate depending on the market
environment, such as business trends, the financial landscape, and the lease market in the specific location of the asset, andthis could impact the Group’s business results and financial position.
[Main Efforts to Address Risk]
The Group makes a careful decision based on a comprehensive review of future asset value and liquidity before working oneach deal and endeavors to ensure a reasonable return for the asset value fluctuation risk. Furthermore, the Group continues
to check the status of asset management, price trends, and industry trends on an ongoing basis even after entering into business
relations and has a system in place to maximize revenue. Additionally, the Group holds warning sign management meetings
as necessary at business divisions and risk management divisions to review industry trends and signs of problems that could
impact asset value fluctuation. The Group also regularly measures the risk of fluctuations in the value of assets in its portfolio
to monitor whether it is within a certain scope of capital, in an effort to ensure sound management.

(iii) Investment Risk
The Mitsubishi HC Capital Group is engaged in investment in and financing of projects such as solar power, wind power, andother renewable energy businesses in and outside Japan as well as various business investments, including loans to operatingcompanies and funds. These investing activities are subject to such risks as risk of changes in the business environment
including business fluctuations and declining demand, risk of revenue falling below the plan due to sluggish performance ofinvestees or partners, risk of diminished recoverability of the investment amount, risk of investee stock value falling below acertain level, and risk of investee stock value staying below a certain level for a considerable period of time due to suddenchanges in the economic or financial situation or a major disruption of the financial markets regardless of the investee’s
performance. These risks could result in a total or partial loss of the investment, including through valuation loss, or create
the necessity of additional funding. In addition, there are the risk that the Group may be unable to exit or restructure thebusiness at the desired time or using the desired method due to differences with the partner’s management policy or low- 32 -

liquidity of the investment asset and the risk that the Group may be disadvantaged by not being able to obtain relevant
information from the investee, and these risks could impact the Group’s business results and financial position.
[Main Efforts to Address Risk]
The Group holds investment meetings according to the individual investment amounts and severity of risk to gather theopinions of the relevant departments and makes a careful decision based on a comprehensive review of future investment
value and liquidity from a broad point of view when considering each investment, thereby endeavoring to ensure a reasonable
return for the risk. Additionally, the Group continues to check the status of investment management and industry trends on an
ongoing basis even after entering into business relations and has a system in place to maximize revenue. The Group also
regularly measures the risk of fluctuations in the value of investments in its portfolio to monitor whether it is within a certain
scope of capital, in an effort to ensure sound management.
(iv) Market Riska.

Interest Rate Fluctuation Risk
The fees for leases and installment sales conducted by the Mitsubishi HC Capital Group are set based on the purchase pricefor the transacted property and the market interest rates at the time of contract. Most of these basically do not fluctuate during
the contract term. The cost of funds for acquiring the leased property, on the other hand, is affected by fluctuations in themarket interest rate as the funds are procured by striking a balance between fixed and variable interest rate funds for
fundraising diversification and reduction of funding costs. As such, a sharp rise in the market interest rate resulting fromsudden changes in the financial situation could impact the Group’s business results and financial position.

b.

Exchange Rate Fluctuation Risk
The Group actively conducts business outside Japan, and as foreign currency-denominated assets increase, so does theirpercentage of consolidated operating assets. The financial statements of the Group’s consolidated subsidiaries outside Japanare expressed in the local currency while the Company’s consolidated financial statements are expressed in Japanese yen. As
such, although fundraising is, in principle, conducted in the same currency as the asset, should a large fluctuation occur inexchange rates, it could impact the Group’s business results and financial position in Japanese yen terms.
[Main Efforts to Address Risk]
The Group constantly watches movements in the financial markets and, as needed, monitors through ALM any imbalances in
the form of interest rates or currency exchange for asset management and for procurement of funds. It then manages interest
rate fluctuation risk through appropriate hedge operations while taking interest rate movements into account. To address
exchange rate fluctuation risk, in principle, the Group raises funds in the same currency as the operating asset in an effort tominimize loss on currency valuation of assets. The Group also regularly measures the quantitative risk of the position of
portfolio holdings incurring a loss over a certain period of time at a certain probability and to what extent in the event thatinterest or currency exchange rates take a disadvantageous turn based on past statistics, and monitors whether it is within acertain scope of capital in an effort to ensure sound management. Meanwhile, the ALM Committee meets quarterly or as
required to analyze scenarios and data in connection with geopolitical risk, pandemics, and various other risk factors and to
determine ALM policy based on trends in the financial market environment, the risk situation, and other considerations.

(v) Liquidity Risk
When engaging in acquisition of lease properties for leases, installment sales, and monetary lending, the Mitsubishi HC CapitalGroup raises a large amount of funds in Japanese yen and other currencies. The Group attempts to balance the period of leases
and other credit transactions and investments with the period of fundraising, but should it experience difficulty securing
enough funds because of heightened risk aversion on the part of financial institutions and investors due to a free fall in
economic and financial conditions and major confusion in the financial markets or a decline in the Group’s creditworthiness,
it could impact the Group’s business results and financial position.
[Main Efforts to Address Risk]
With respect to the procurement of funds, the Group tries to ensure the liquidity of funds through efforts to diversify byprocuring funds directly from the market including corporate bonds, commercial papers, and securitization of lease receivables
in addition to borrowing from financial institutions as well as through procurement with long- and short-term balance, carefulmanagement of cash flows, and measures to supplement liquidity during emergencies, such as through the acquisition ofcommitment lines. Additionally, the Group conducts stage-by-stage management of liquidity, putting in place funding
arrangements to ensure that the immediately necessary funds can be secured, including funds for repayment, even if thefundraising environment deteriorates, and reporting on the status of funding to the ALM Committee.

- 33 -

In addition to analyses of credit, interest rate sensitivity (the impact on revenue of interest rate fluctuation) and other items,
the ALM Committee carries out comprehensive investigations of (iv) Market Risk and (v) Liquidity Risk in the event of stressdeveloping in the financial markets or other relevant areas, including the potential impact on profit. It then decides a fundprocurement strategy and risk response policies as the basis for the rollout of a Companywide strategy reflecting the market
environment. Regarding risk management in particular, it coordinates with the Risk Management Committee, which is one
arm of the Companywide integrated risk management system. By strengthening the warning sign management system andcoordinating with contingency planning, it makes efforts to improve the flexibility and resilience of financial structures in theevent of a crisis situation emerging.
Meanwhile, to support the globalization of its business over recent years and also to increase its ability to procure foreign
currency, the Group is progressing with the reorganization of its regional financial bases. As part of this, it has established aregional financial base in North America where it holds a large asset balance, thus putting in place a Group financing system,
which includes the consolidation of financing. The North American regional financial base offers not only indirect financing
but also various forms of fund procurement, including issuance of commercial papers and corporate bonds, thus providing
funds to Group companies expanding into North America.
(vi) Operational Riska.

Risk related to Earthquakes, Wind and Flood Damage, Pandemics, War, Terrorism, etc.
The Mitsubishi HC Capital Group uses facilities, including sites and systems, in and outside Japan to conduct its operations.
Earthquakes, wind and flood damage, or other natural disasters as well as pandemics, war, terrorism, or other unpredictable
circumstances could cause a reduction of activities or prevent operations at those sites by damaging the sites themselves or
the systems or by injuring employees or preventing them from coming to work, thereby disrupting business operations.
Moreover, depending on the extent of the damages or how long the event lasts, a large sum of money could be required torestore the systems or other facilities, or it may take a long time for business operations to recover. Such a situation could
impact the Group’s business results and financial position.

[Main Efforts to Address Risk]
The Group has established responsible departments depending on the envisioned risk to prepare for such circumstances andhas a system in place to establish a crisis response headquarters to respond to a critical situation. The Group is also working
to establish a system for business continuity by putting together a business continuity plan, implementing redundancy
measures for backbone systems, establishing a system infrastructure that allows work from home, and implementing office
shifts limited to operations that must continue.
As the Group does not have bases in Ukraine or Russia, it envisages limited direct impact from the situation in the region.
However, should the situation escalate going forward, there may be indirect impacts such as an increase in non-performing
loans due to worsening of the credit status of customers. This might require measures such as additional provisions ofallowance for doubtful receivables, which could impact the Group’s operating results and financial position.
In March 2022, the Group set up a Crisis Management Headquarters that is working to address cybersecurity, trade control,and money laundering, track financial trends, enhance screening and management of deals, monitor the impact on the valueof Group operating assets, and identify and manage other indirect impacts.
b. System Risk
The Group utilizes e-mail as well as a variety of information systems to conduct account processing, management of various
contracts, customer management, asset management of leased properties, and other operations. An outage or failure of theseinformation systems arising from poor maintenance, poor development, or other such problems could cause an interruption ofcontract and collection operations or services provided to customers, which in turn could cause a suspension of operating
activities and economic loss, thereby impacting the Group’s operating results and financial position.
[Main Efforts to Address Risk]
The Group has a system in place to properly manage and maintain these systems through internal cooperation and partnershipwith other companies in order to ensure their stable operation. The Group is equipped with an integrated response system for
failures that includes swift action and sharing of information internally and externally where the failure occurs as well as
establishment and implementation of measures to prevent subsequent recurrence. Additionally, Group-wide IT control isimplemented for system development at the Group companies in Japan and other countries by using standardized methods aspart of a proprietary process.
c.

Cybersecurity Risk and Information Security Risk
The Group utilizes e-mail as well as a variety of information systems to conduct account processing, management of various
contracts, customer management, asset management of leased properties, and other operations. These information systems are- 34 -

subject to risk of business e-mail scams, malware infections, unauthorized access by outside parties, and other cyberattacks.
Unauthorized access by outside parties, malware infections, human error, fraud, scams, and other problems could result insystem outages or failures, monetary damages, leaks or unauthorized use of confidential information or customer information,or other incidents. These could cause an interruption of contract and collection operations or services provided to customers,
which in turn could cause a suspension of operating activities, economic loss, or loss of social confidence from leakage ofimportant information, thereby impacting the Group’s operating results and financial position.
[Main Efforts to Address Risk]
The Group has established a cross-organizational Security Incident Response Team (MHC-SIRT) to address these risks andhas a system in place to prevent incidents at the entrance, internal, and exit stages and respond to them if they occur.
Specifically, in preparation for cyberattacks that exploit vulnerabilities, the Group keeps software up to date to detect
unauthorized access, malware, and other cyberattacks and maintains management preparedness to prevent problems. At thesame time, the Group has established an internal and external coordination system and conducts drills to prepare for incidents.
Moreover, targeted e-mail training is provided for all employees, and internal education on information security is carried out
on an ongoing basis.
d. Legal Risk
The Group’s operations are subject to a range of relevant legislation in and outside Japan. As the primary examples, in Japan
its operations must comply with the Companies Act, tax laws, the Financial Instruments and Exchange Act, the Anti-Monopoly
Act, the Personal Information Protection Act, the Money Lending Business Act, the Installment Sales Act, the Act on
Prevention of Transfer of Criminal Proceeds, and laws and regulations related to the environment. Outside Japan, the Group’s
operations are subject to the legislation of each country and region as well as to oversight by regulatory authorities. Should
there be a failure of compliance with legislation or company rules, it could impact the Group’s operating results and financial
position by causing restriction on or interruption of operations, a claim for damages from customers or others, and a fall insocial confidence.
[Main Efforts to Address Risk]
The Group strictly adheres to laws, regulations, and company rules in conducting its operations. The Group has establishedthe Principles for Prevention of Bribery and Corruption, the Principles for Compliance with Competition Laws, the Basic
Policy on Anti-social Elements, the Principles for Money-Laundering Prevention, the Personal Information Protection Policy,
and the Principles for National Security Export Control and prepared the Compliance Manual to disseminate these policies
and rules to all executives and employees of the Group, which is available for viewing at any time on the Company intranet.
In addition, the Group provides ongoing compliance education. The Group is working to strengthen its compliance systemand has also established the Compliance Hotline System, which it operates while regularly incorporating feedback fromoutside experts.
e.

System Change Risk
The Group’s operations are subject to a range of relevant legislation, accounting and tax regulations, and other systems in andoutside Japan. Should there be substantial changes or revisions to any of the various systems closely related to the Group’s
operations that the Group was unable to properly address, there could be penalties for nonconformance, suspension of productoffering, restrictions on business activities, sales losses, or other negative consequences that could impact the Group’s businessresults and financial position.

[Main Efforts to Address Risk]
The Group’s corporate centers, business divisions, sales bases in Japan, and sites in each country continuously monitor
revisions and changes to the various systems in and outside Japan, such as legal, accounting, and tax systems, applying to therelevant country and services. In addition, the Group gathers information on and implements measures to address changes andrevisions as quickly as possible while reinforcing such monitoring by actively utilizing outside experts.
f.

Administrative Risk
The Group conducts transactions in various forms, and various administrative work arises with each transaction. Improper
administrative work, including human error, fraud, and other irregularities, could cause an interruption of contract andcollection operations or services provided to customers, which in turn could cause a suspension of operating activities or lossof customer trust, thereby impacting the Group’s operating results and financial position.
[Main Efforts to Address Risk]
The Group has established administrative rules for each transaction and conducts business according to these rules while
reviewing them as needed. Additionally, an internal reporting system is in place for internal administrative incidents. Should- 35 -

such an incident occur, the system includes internal reporting, swiftly addressing the incident, identifying the cause, andestablishing/implementing measures to prevent recurrence.
(3) Other Major Risks
In addition to risk addressed in the framework of integrated risk management, the Group recognizes the major risks listed
below. These risks are managed within the integrated risk management framework, including individual impact and combined
impacts across multiple risk items, according to their individual characteristics and status. The Group explores a unified
response and formulates a response policy as necessary and additionally conducts scenario analysis appropriate to the situationas part of a multi-faceted verification of risk resilience.
(i)

Risk Related to Conduct
The Group is implementing various measures based on the keyword of “transformation” to achieve Our 10-year Vision of“Together we innovate, challenge and explore the frontiers of the future.” During this process, any actions by our executives
and employees that compromise customer protection, fair competition, market integrity, public interest, or social norms andcause harm to our stakeholders could impact the Group’s credibility, business results, and financial position.

[Main Efforts to Address Risk]
The Group emphasizes integrity as one of the core elements of the Action Principles, which set forth the values and mindset
to be held and actions to be taken by each and every employee within the Basic Management Policy. This means maintaining
high ethical standards and constantly returning to the basics. The Group ensures that all executives and employees conduct
themselves accordingly. In addition, the Group has established the Mitsubishi HC Capital Group Code of Ethics and Code of
Conduct. While ensuring that all executives and employees maintain high ethical standards and respect both laws andregulations and the spirit of social norms, the Group also provides ongoing education on the topic of integrity.
(ii) Risk Related to Personnel Recruitment
The Mitsubishi HC Capital Group must stably secure adequate human resources, in order to maintain and strengthen its
competitiveness in the various businesses it operates in and outside Japan. The Group strives to continuously recruit and train
capable personnel, but should it not be able to adequately secure and train the needed personnel this could impact the Group’sbusiness results and financial position.
(iii) Risk Related to Labor and Employment Management
The Group employs a large number of staff in its business operations. This involves the risk of long working hours having anegative effect on the mental or physical health of employees or other negative impacts, making them unable to fulfill the
expected duties, and the risk of legal infringement due to failure to appropriately monitor legal requirements relating toemployment and related areas. Additionally, there is the possibility of these risks resulting in damage to public trust.
To lessen the abovementioned risks, the Group promotes projects aimed at improved productivity and introduces systems toenable diverse workstyles (teleworking, flextime, etc.). In this way, it works not only to reduce long working hours but also
to put in place a work environment that accommodates employees with childcare or nursing care responsibilities. Additionally,
to address harassment and other personnel issues, the Group has introduced measures for employees in and outside Japan,
including internal whistleblowing systems and advice services. To enable employees to develop their abilities to the full, theGroup is addressing workplace enhancement as a major focus of initiatives.
(iv) Risk Related to Expansion of Operating Base, Strategic Partnerships, and M&As
In pursuit of continued growth through expansion of its operating base, the Mitsubishi HC Capital Group engages, in andoutside Japan, in strategic partnerships with outside entities aimed at the enhancement of various services and tries to diversify
and expand the Group’s business portfolio through M&As in addition to expanding business on its own.
The Group endeavors to diversify its business and enhance its services through this kind of approach. However, changes inthe domestic or international economic and financial conditions, intensification of competition, changes in the businessenvironment or strategy of partners, revision of relevant legislation, and other factors could cause a failure to achieve expected
results or result in the need to record additional expenses, such as impairment of goodwill recorded at the time of an M&A.
Such a situation could impact the Group’s business results and financial position.
[Main Efforts to Address Risk]
In addition to review by the relevant departments according to the individual investment amounts and severity of risks, theGroup brings in outside experts for a comprehensive review of the fitness of the investment structure and the future investment
effect from a broad point of view when considering each M&A or partnership deal. Even after an M&A deal is executed, the- 36 -

Group’s rules are applied to establish a system for proper operational management, and monitoring is carried out on thebusiness plan, results management, and other aspects so that the necessary actions can be taken in a timely manner.
(v) Risk Associated with Expansion of Business Domains
The Mitsubishi HC Capital Group is expanding the scope of its operations on a global basis, including new business domains,
within the scope permissible under laws, regulations, and various other conditions. Should risks emerge within that processthat exceed the scope of reasonable assumptions despite verification of the risks along with our knowledge and experience inthe expanded business domain, or if the expanded business does not develop as envisioned, it could impact the Group’sbusiness results and financial position.
(vi) Intensifying Competition
Competition in the leasing and other businesses of the Mitsubishi HC Capital Group conducted in and outside Japan could
intensify not only from companies in the same business but also from financial institutions and others, or the competitive
landscape could change due to a shift in business models of other industries, technical innovation, or other factors. The Groupmakes various efforts to maintain and strengthen its competitiveness, including by offering greater added value to its customers
and creating value as an asset holder and through low-cost fund procurement. However, should the current competitive
situation intensify further, a fall in market share and decline in income could impact the Group’s business results and financial
position.
(vii) Climate Change Risk
Failure to respond to regulatory changes, technological innovations, or shifts in business models associated with the transition
to a decarbonized society, or extreme weather conditions associated with global warming could cause customer bankruptcies
due to deteriorating performance or could cause the value of assets held by the Group to decline, which could impact theGroup’s business results and financial position. Moreover, if the Group’s response to climate change risk or its information
disclosure are inadequate, or are deemed to be so, there is the possibility for the Group’s corporate value to be damaged.
[Main Efforts to Address Risk]
The Group recognizes promoting a decarbonized society as a priority task in achieving sustainable growth that forms part ofits materiality (material issues). Accordingly, the Group has expressed its support for the recommendations of the Task Forceon Climate-Related Financial Disclosures (TCFD) and is working to enhance risk identification and assessment and relevant
information disclosure in accordance with the recommendations. Additionally, the Group recognizes climate change as asignificant risk for Companywide risk management and is progressing with relevant initiatives.
(viii) Human Rights Violation Risk
With corporate responsibility extending throughout the supply chain and the emphasis on sustainability initiatives, theprevailing view is that companies should recognize stakeholders as broadly encompassing ordinary individuals and local
residents. Under these circumstances, if the Group were to neglect these stakeholders, and human rights violations were tooccur within the Group or be committed by customers of the Group, it could be perceived as the Group itself causing,encouraging, or directly participating in those human rights violations. In turn, this could lead to damage to the Group’s
corporate value.
[Main Efforts to Address Risk]
The Group established the Human Rights Policy in September 2022, declaring that we “recognize that conducting businesswith the utmost respect of human rights is a major challenge, and we will fulfill our responsibilities in this matter across all
our business activities.” In addition, the Group launched an internal project to address human rights violation risk in October
2022. Moving forward, the Group will continue to advance efforts to eliminate human rights violations.
(ix) Global Pandemic Risk
Should a global pandemic arise, negative consequences such as broad disruption of the supply chain, temporary restrictions
on or suspension of economic activity by each national government, and damage to industrial systems or financial functions
could impact a wide range of customers or businesses utilizing the assets of the Mitsubishi HC Capital Group. This may resultin customer bankruptcies or a drop in the value of the Group’s asset holdings, which could impact the Group’s business results
and financial position.
Despite the subsiding of the COVID-19 pandemic, which had continued since 2020, the Group will continue to promote
diverse and flexible workstyles that utilize the IT remote communication tools and telecommuting systems, which were rolled
out during the pandemic for both internal and external use. This will be done from the standpoint of improvement of
productivity and Business Continuity Management (BCM) including the prevention of the spread of infection.

- 37 -

(4) Stress Tests
In the execution of management strategy, the Group makes efforts to gauge the degree of impact of stress periods caused byvarious risk events with potential impact on its business, such as deterioration in market conditions including economic
downturns and market fluctuation. Specifically, the Group has posited a number of potential high-stress scenarios, ranging
from a deterioration in the overall world economy to market fluctuation, deterioration in credit, and the emergence of largescale concentrations of risk in individual business fields. Based on these scenarios, it has undertaken analysis and verificationof the potential degree of impact of stress conditions on profitability and equity in each fiscal period.
These multifaceted verifications enable the Group to confirm its risk resilience and to ensure that the risk-return balance ofmanagement plans does not exceed tolerable levels.

- 38 -

4. Management’s Analyses of Consolidated Financial Position, Operating Results and Cash Flows(1) Overview of Operating Results, etc.
The financial position, operating results and cash flows of the Group (the Company, consolidated subsidiaries and affiliatedcompanies accounted for by the equity method) (hereinafter referred to as “operating results, etc.”) for the fiscal year underreview are as follows.
Segment profit or loss presented is consistent with net income attributable to owners of the parent in the consolidated
statements of income.
(Consolidated Operating Results)(Billions of yen)

Fiscal Year ended March Fiscal Year ended March
31, 2023
31, 2024

Changes

Changes (%)

Revenues

1,896.2

1,950.5

54.3

2.9

Gross Profit

357.3

380.0

22.7

6.4

Operating Income

138.7

146.1

7.4

5.4

Recurring Income

146.0

151.6

5.5

3.8

116.2

123.8

7.6

6.5

2,640.6

3,051.9

411.3

15.6

Net Income
Attributable to
Owners of the Parent
New Transactions
Volume(Consolidated Financial Position)(Billions of yen)

Fiscal Year ended March Fiscal Year ended March
31, 2023
31, 2024

Changes

Changes (%)

Total Equity

1,551.0

1,705.3

154.3

9.9

Total Assets

10,726.1

11,149.8

423.6

3.9

Interest-Bearing Debt

8,236.1

8,439.7

203.6

2.5

14.3

15.1

0.8pt

–

Equity Ratio (%)- 39 -

(i)Financial Position and Operating Results
For operating results, etc. for the fiscal year under review, the volume of new transactions increased by ¥411.3 billion or
15.6% year on year to ¥3,051.9 billion.
Revenues increased by ¥54.3 billion or 2.9% to ¥1,950.5 billion.
Meanwhile, gross profit rose by ¥22.7 billion or 6.4% to ¥380.0 billion, operating income by ¥7.4 billion or 5.4% to ¥146.1
billion, recurring income by ¥5.5 billion or 3.8% to ¥151.6 billion, and net income attributable to owners of the parent by¥7.6 billion or 6.5% to ¥123.8 billion.
As of March 31, 2024, total assets increased by ¥423.6 billion or 3.9% from the previous fiscal year-end to ¥11,149.8 billion,
while total equity rose by ¥154.3 billion or 9.9% to ¥1,705.3 billion, and interest-bearing debt (excluding lease obligations)increased by ¥203.6 billion or 2.5% to ¥8,439.7 billion. The equity ratio increased by 0.8 points to 15.1%.

(ii) Cash Flows
Cash and cash equivalents as of March 31, 2024 totaled ¥335.3 billion, a decrease of ¥125.1 billion or 27.2% from theprevious fiscal year-end.
The ¥125.1 billion decrease came from ¥49.1 billion used in operating activities and ¥222.9 billion used in financing
activities despite ¥143.3 billion provided by investing activities.
Operating activities used net cash of ¥49.1 billion compared to net inflows of ¥46.7 billion in the previous fiscal year.
Inflows from income before income taxes of ¥167.6 billion with an adjustment of ¥527.0 billion for depreciation and loss
on disposal and sales of leased assets, a decrease in lease receivables and investments in leases of ¥64.1 billion, a decreasein loans receivable of ¥16.4 billion, a decrease in installment receivables of ¥12.1 billion, and an increase in trade payablesof ¥10.9 billion were set against outflows from purchases of leased assets of ¥884.8 billion.
Investing activities provided net cash of ¥143.3 billion compared to net outflows of ¥127.3 billion in the previous fiscal
year. This mainly consisted of proceeds from withdrawal of/payments into time deposits of ¥125.8 billion.
Financing activities used net cash of ¥222.9 billion compared to ¥8.9 billion in the previous fiscal year. Net outflows of¥70.5 billion for direct funding and ¥89.8 billion for bank loans and other forms of indirect funding were set against items
including ¥51.7 billion in cash dividends paid.

- 40 -

(iii) Operating Transactionsa.

New Transactions Volume
The actual volume of new transactions for each segment in the fiscal year is as follows.
Previous Fiscal Year
(Billions of yen)
Reportable Segments

New Transactions
VolumeCustomer
SolutionsGlobalBusiness

Environment& Energy

933.2

1,300.7

35.8

Adjustments
Aviation

Logistics

Real Estate

Mobility

55.3

87.9

31.8

195.6

–

Total

2,640.6

Fiscal Year under Review(Billions of yen)
Reportable Segments
Customer
Solutions
New Transactions
VolumeGlobalBusiness

984.8

1,389.6

Environment& Energy
22.8

Adjustments
Aviation

Logistics

Real Estate

38.3

152.0

456.3

Total

Mobility
14.3

(6.4)

3,051.9b. Operating Results
Operating results for each segment in the fiscal year are as follows.
Previous Fiscal Year
(Billions of yen)
Reportable Segments
Customer
SolutionsGlobalBusiness

Environment& Energy

Aviation

Logistics

Real Estate

Mobility

Amountrecorded in
Adjustments Consolidated
Statement of
IncomeGross Profit

116.5

121.1

16.4

33.6

32.1

24.9

9.0

3.4

357.3

Segment Profit

38.1

29.0

11.6

6.2

15.3

12.6

3.7

(0.6)

116.2

Fiscal Year under Review(Billions of yen)
Reportable Segments
Customer
SolutionsGlobalBusiness

Environment& Energy

Aviation

Logistics

Real Estate

Mobility

Amountrecorded in
Adjustments Consolidated
Statement of
IncomeGross Profit

115.9

135.3

10.4

49.1

35.5

23.8

1.2

8.4

380.0

Segment Profit

38.1

16.6

7.3

27.3

17.8

11.9

2.7

1.8

123.8

c.

Segment Asset Balance
Segment asset balance at the end of the fiscal year is as follows.
Previous Fiscal Year
(Billions of yen)
Reportable Segments
Customer
Solutions

Segment Assets

3,227.7

GlobalBusiness
2,644.2

Environment& Energy
433.2

Aviation
1,640.2

Logistics

Real Estate

1,092.9

447.2

Mobility
41.4

Amountrecorded on
Adjustments
theConsolidated
Balance Sheet
1,199.0

10,726.1(Note) Segment assets include operating assets, investments in the affiliates accounted for by the equity method, goodwill andinvestment securities. Adjustments include segment assets not attributable to any reportable segments, and the difference
between the total amount of segment assets and the total assets on the consolidated balance sheet, which consists of cash andcash equivalents and own-used assets, etc.

- 41 -

Fiscal Year under Review(Billions of yen)
Reportable Segments
Customer
Solutions
Segment Assets

2,966.5

GlobalBusiness
3,070.8

Environment& Energy
416.6

Aviation
2,020.0

Logistics

Real Estate

1,099.0

525.4

Mobility
51.9

Amountrecorded on
Adjustments
theConsolidated
Balance Sheet
999.4

11,149.8(Note) Segment assets include operating assets, investments in the affiliates accounted for by the equity method, goodwill andinvestment securities. Adjustments include segment assets not attributable to any reportable segments, and the difference
between the total amount of segment assets and the total assets on the consolidated balance sheet, which consists of cash andcash equivalents and own-used assets, etc.

- 42 -

(2) Views and Issues Analyzed/Discussed with Regard to the Operating Results, etc. from the Management’s Perspective(i)

Overview of Financial Results, etc.
For the fiscal year ended March 31, 2024, net income attributable to owners of the parent increased by ¥7.6 billion to ¥123.8
billion. The annual dividend per share was ¥37, increasing for 25 consecutive fiscal years.

Net income attributable to owners of the parent for the fiscal year ended March 31, 2024 exceeded the initial forecast of¥120.0 billion by ¥3.8 billion, or 3.2%, hitting a record high for two consecutive years.

The annual dividend per share increased by ¥4 year on year to ¥37, as per initial forecast, increasing for 25 consecutive
fiscal years.

Increase/Decrease in Net Income Attributable to Owners of the Parent(Billion Yen)

(1)
+28.8
-6.9
(2)

Net
Income
+7.6

(5)
+8.9
-5.8

(3)

-10.5
(4)

Business
Growth*1+21.9

-6.9
(6)
123.8

116.2

Positive Factor
FYE3/2023
2023/3期*1*2

Business
事業成長*¹Grow th*1*2を除く）（減損等(Excl.
Impairment
Losses, etc.* 2)

Negative Factor

Impairment Credit Costs Operating
減損等*²
経費
Losses, 貸倒関連費用 Expenses
etc.*2Extraordinary
Others
FYE3/2024
特別損益 (Taxその他
Expenses, 2024/3期
Income/Lossetc.)

The amount of business growth is the combined total of gross profit and non-operating income/loss (the amount of nonoperating income/loss does not include gains on bad debts recovered).
The amount of impairment losses, etc., is the combined total of impairment losses and losses on certain U.S. projects in
the Real Estate segment.

Major factors for increase/decrease in net income attributable to owners of the parent are as follows (the amounts provided
reflect the impact on income before income taxes).
Business Growth (excluding impairment losses, etc.)
Impairment Losses, etc.

¥28.8 billion¥(6.9) billion

Increase in Credit Costs
Increase in Operating Expenses¥(5.8) billion¥(10.5) billion

Increase in Extraordinary Income/Loss
Increase in Others (tax expenses, etc.)¥8.9 billion¥(6.9) billion(ii) Major Topics
Formulation and Announcement of the Medium-Term Management Plan for FY2023 - FY2025 (“2025 MTMP”)
The Company formulated a Medium-term Management Plan covering the three-year period from the fiscal year ended March
31, 2024 to the fiscal year ending March 31, 2026 (“2025 MTMP”), which was announced in May 2023. The 2025 MTMP is
positioned as the “hop” plan of our three Medium-term Management Plans (“hop,” “step,” and “jump”) toward Our 10-Year
Vision (Together we innovate, challenge and explore the frontiers of the future). The financial targets for the fiscal year ending
March 31, 2026, the final fiscal year of the 2025 MTMP, are net income attributable to owners of the parent of ¥160.0 billion,
ROA of approximately 1.5%, ROE of approximately 10%, and a payout ratio of 40% or more during the 2025 MTMP period.
Net income attributable to owners of the parent is used for the calculation of ROA and ROE.

- 43 -

For details on the 2025 MTMP, please refer to “1. Management Policy, Business Environment and Tasks Ahead, etc.” in “Item2. Business Overview.”
Major Business Topics
April 2023

 Announced the conclusion of a “Virtual PPA” (non-fossil certificate transfer agreement for
renewable energy electricity) between Mitsubishi HC Capital Energy Inc., which is engaged in the
renewable energy power generation business, and Tokyo Metro Co., Ltd.
 Made CenterPoint Development Inc., a Group company engaged in the development of logistics
facilities and an asset management business specializing in such facilities, a wholly owned
subsidiary.

 Established the “Innovation Investment Fund” with a total ¥10.0 billion of funds available forinvestments in startups with the aim to promote creation of new services and development of new
businesses, and started operations.
<Investment Activities in FY2023 (fiscal year ended March 31, 2024)>
Investee Companies

Business Description

Tabist Co., Ltd.

Provision of DX services for hotel reservation management
and pricing

ZERO Co., Ltd

Operation of vending machines to contribute to reduction offood loss

Credit Engine Group, Inc.

Development and operation of online trading platformbusiness

MedUp, Inc.

Provision of products to improve hospital management suchas enhancement of regional cooperation

matsuri technologies Inc.

Operation of private lodging and short-term rental services

M-INT Inc.

Development of electronic referral systems and medical
resource databases

Aakel Technologies Inc.

Provision of DX services related to decarbonization and EV
energy management

May 2023

 Announced HSE Ltd., engaged in the renewable energy power generation business, launched arenewable energy aggregation business (prediction of renewable energy power generation andpreparation of power generation plans, and provision of electricity and non-fossil value based onthem).

August 2023

 Announced to start business operations in Silicon Valley in the U.S. to strengthen the business

September 2023

 Mitsubishi HC Capital Energy Inc. and Mitsubishi Auto Leasing Corporation launched an

intelligence function as part of the innovation initiatives.
integrated service necessary for the introduction and operation of EVs, including the supply of EVs
and charging infrastructure as well as renewable energy as the power source.

 Announced the business alliance with Horizon Ocean Management, Ltd. with the aim of stabilizing
and improving efficiency of the O&M service (maintenance, inspection and repair) in the offshore
wind power generation business.
November 2023

 Announced the business alliance with Lenovo Japan LLC and Mitsubishi UFJ Trust and Banking
Corporation with an aim to provide a comprehensive package service to support startups, including
PC subscription service.
 Announced the launch of a verification project using robots in logistics facilities, as a METI
commissioned project, together with BIC CAMERA INC. and YAMAZEN CORPORATION.
 Started offering facial photo collection and authentication service on a subscription model with
TOPPAN Edge Inc.

 Signed a partnership agreement with AeroEdge Co., Ltd. manufacturing and selling aircraft engine
December 2023

parts with an aim to enhance the partnership to accelerate DX and SDGs in the aviation industry.
 Selected the first projects that passed the final review in the internal startup program of the ZeroGravity Venture Lab, an initiative aimed at accelerating new business development, and officiallylaunched the projects toward the establishment of a company.

- 44 -

 Announced to start a trial for a preventive maintenance service for infrastructure using an
January 2024

February 2024

earthworm-like in-pipe crawling robot “Sooha” offered by SoLARIS Inc.
 Decided to invest in European Energy A/S, a Danish company developing and operating renewable
and next generation energy business (investment was executed in April 2024).
 Transferred shares of DFL Lease Co., Ltd. and Shutoken Leasing Co., Ltd., both Group companies.

 Announced the launch of a joint venture for renewable energy generation based on a PPA (Power
Purchase Agreement) between the Group, TOKYU CORPORATION and TOKYO POWER
SUPPLY CO., LTD and the conclusion of a contract for the first project.
 Announced the transfer of shares of Sekisui Leasing Co., Ltd., a group company (transfer conductedin June 2024).
 Decided to establish the “Robotics Business Development Department,” a dedicated organizationto accelerate the development and promotion of new businesses in the robotics sector, in April 2024.

March 2024

 Began the full-scale utilization of generative AI by the Company in cooperation with Hitachi, Ltd.

(iii) Operating Results by Reportable Segment
Operating results by reportable segment are as follows.
In accordance with the organizational changes effective April 1, 2023, the name of the reportable segment “Environment,
Energy & Infrastructure” was changed to “Environment & Energy” from the fiscal year under review.
Details of the business of each segment are as described in “3. Description of Business” in “1. Overview of the Company andits Consolidated Subsidiaries.”

Segment Profit (net Income attributable to Owners of the Parent by Segment) Year on Year

(Billions of yen)

Main Factors for Changes in Segment Profit
Customer Solutions
Segment profit remained unchanged year on year at ¥38.1 billion mainly due to an increase in gains on sales of strategic
shareholding, despite the absence of large gains on sales of assets related to real estate leasing and insurance claim income
from a certain deal recorded in the previous fiscal year.
Global Business
Segment profit decreased by ¥12.4 billion, or 42.8% year on year, to ¥16.6 billion. This was mainly due to an increase in credit
costs in line with the worsening market condition of the transportation sector that was strong during the COVID-19 pandemic
in the Americas and the absence of gains on revaluation of securities recorded in Europe in the previous fiscal year, despite
the positive effects of adjusting the fiscal period associated with the reorganization of subsidiaries in the Americas.
Effective April 1, 2023, we executed the business integration of three subsidiaries in the Americas with a different fiscal yearend. While the surviving company’s fiscal year-end is March 31, the two merged companies’ fiscal year-end was December- 45 -

31. Accordingly, results of the two merged companies for the period from January 1, 2023 to March 31, 2023 are also includedin the consolidation for the fiscal year ended March 31, 2024, resulting in a year-on-year increase in profit.
Environment & Energy
Segment profit decreased by ¥4.3 billion, or 37.1% year on year, to ¥7.3 billion mainly due to recording of impairment losses
on a solar power generation project in Japan and a decrease in profits from equity-method investments despite an increase ingains on sale of assets.
Aviation
Segment profit increased by ¥21.1 billion, or 340.3% year on year, to ¥27.3 billion mainly thanks to an increase in leasing
revenues, a reversal of large credit costs, a decrease in impairment losses, and a decrease in exchange revaluation losses related
to foreign currency-denominated borrowings in aircraft leasing transactions that our head office is engaged in.
Logistics
Segment profit increased by ¥2.4 billion, or 15.9% year on year, to ¥17.8 billion mainly thanks to an increase in gains on saleof assets (mainly shipping) despite a decrease in leasing revenues attributable to the normalization of the utilization rates ofmarine containers after a period of overheated market conditions.
Real Estate
Segment profit decreased by ¥0.7 billion, or 5.6% year on year, to ¥11.9 billion mainly due to recording of losses in U.S.
projects against a backdrop of the worsening real estate market, the negative effect of the deconsolidation of Diamond Asset
Finance Company Limited, and an increase in tax expenses despite an increase in gains on sale of assets and the recording ofgains on step acquisitions in relation to making CenterPoint Development Inc. a wholly owned subsidiary.
Mobility
Segment profit decreased by ¥1.0 billion, or 26.4% year on year, to ¥2.7 billion mainly due to the negative effect of thedeconsolidation of Mitsubishi HC Capital Auto Lease Corp.
(iv) Financial Position
As of March 31, 2024, total assets increased by ¥423.6 billion or 3.9% from the previous fiscal year-end to ¥11,149.8 billion,
while total equity rose by ¥154.3 billion or 9.9% to ¥1,705.3 billion, and interest-bearing debt (excluding lease obligations)increased by ¥203.6 billion or 2.5% to ¥8,439.7 billion. The equity ratio increased by 0.8 points to 15.1%.
(v) Capital Resources and Liquidity of Funds
We obtain a large amount of funds in domestic and foreign currencies to fund our operations such as lease transactions andproviding loans.
At the end of the fiscal year under review, interest-bearing debt (excluding lease obligations) increased ¥203.6 billion fromthe previous fiscal year-end to ¥8,439.7 billion, and total liabilities increased ¥269.3 billion from the previous fiscal year-end
to ¥9,444.5 billion. Out of interest-bearing debt, long-term liabilities such as long-term borrowings rose by ¥189.8 billion
from the previous fiscal year-end to ¥5,383.9 billion, while short-term liabilities such as short-term borrowings andcommercial paper increased by ¥13.8 billion from the previous fiscal year-end to ¥3,055.8 billion.
We are committed to securing funds to support our businesses at any time while we control the cost of funds. We diversify
our financing methods such as by using indirect financing through borrowings from financial institutions and direct financing
through corporate bonds, commercial papers, and securitization of lease receivables. With regard to indirect financing, we
continue borrowing from wide range of financial institutions with long standing relationship, such as Japan’s three megabanks, regional banks, and life insurance companies. With regard to direct financing, we diversify our funding source, suchas issuing corporate bonds for retail investors as well as financing from banks and institutional investors.
With regard to fund management in the entire Group, we have put in place a system to allocate funds efficiently utilizing
group finance from Mitsubishi HC Capital and Regional Treasury Base.
From the perspective of liquidity, we manage cash flows closely and monitor funding liquidity risk even in normal times. The
quarterly ALM Committee identifies the current status and issues of liquidity risk and discusses measures against the risk. We
are committed to maintaining a strong financial position through these risk management initiatives.
In order to prepare for changes in the funding environment due to financial market turmoil and various risks, we have madeoverdraft agreements and commitment line agreements with multiple financial institutions to secure liquidity support in theevent of an emergency. At the end of the fiscal year, the undrawn commitment in the Group amounted to ¥737.8 billion.

- 46 -

For cash flows, please refer to “(ii) Cash Flows” in “(1) Overview of Operating Results, etc.” in “4. Management’s Analysesof Consolidated Financial Position, Operating Results and Cash Flows” of “Item 2. Business Overview.”(vi) Significant Accounting Estimates and Assumptions used in Such Estimates
Of the accounting estimates used in the preparation of the consolidated financial statements and the non-consolidated financial
statements and the assumptions used in such estimates, those that are significant are described in “Notes on Significant
Accounting Estimates” in “1. Consolidated Financial Statements, etc.” of “Item 5. Financial Information” and “Notes on
Significant Accounting Estimates” in “2. Non-Consolidated Financial Statements, etc.” of “Item 5. Financial Information.”(3) Status of Operating Loans Receivable based on the Cabinet Office Ordinance on Disclosure of Specified Finance
Companies, etc. (Ordinance of the Ministry of Finance No. 57 of May 19, 1999)
The status of operating loans receivable in the Company is as follows.
(i)

Breakdown of Loans Receivable Outstanding by Type(As of March 31, 2024)
Average
Percentage (%) Contracted Interest
Rate (%)

Number (Items)

Percentage (%)

Balance (Millions
of Yen)Unsecured (excluding
Housing)

25

0.29

29

0.00

2.08

Secured (excluding Housing)

–

–

–

–

–

5,541

64.67

26,414

1.78

1.49

5,566

64.96

26,444

1.78

1.49

Total

3,003

35.04

1,456,697

98.22

2.24

Total

8,569

100.001,483,142

100.002.18Type of Loans Receivable
For Consumers

For Housing
Total
For Business Operators(ii) Breakdown of Financing(As of March 31, 2024)
Lenders, etc.

Balance (Millions of Yen)

Average Financing Interest Rate (%)

Borrowings from Financial Institutions, etc.

1,993,777

2.10

Others1,817,669

0.74

1,757,867

0.75

3,811,447

1.45

831,723–

33,196–

Corporate Bonds andCommercial Papers
Total
Shareholders’ Equity
Share Capital andCapital Contributions(Notes) 1. The total amount of loans receivable transferred in the fiscal year under review was ¥0 million.
2. The average financing interest rate is the weighted average interest rate based on the contracted interest rate on the yearend balance of borrowings, etc.

- 47 -

(iii) Breakdown of Loans Receivable Outstanding by Industry(As of March 31, 2024)
Number of Obligors(Items)By Industry

Balance (Millions of
Yen)

Percentage (%)

Percentage (%)

Manufacturing

114

2.16

33,8722.28

Construction

18

0.34

667

0.05

38

0.72

83,486

5.63

28

0.53

305,377

20.59

226

4.28

20,646

1.39

Finance and Insurance

34

0.64

44,481

3.00

Real Estate

201

3.80

452,337

30.50

Service

478

9.05

475,796

32.08

Agriculture

–

–

–

–

Individuals

4,057

76.78

26,444

1.78

90

1.70

40,032

2.70

5,284

100.001,483,142

100.00Electricity, Gas, Heat Supply and
Water
Transport and Communications
Wholesale and Retail Trade, andEating and Drinking Places

OthersTotal(iv) Breakdown of Loans Receivable Outstanding by Collateral(As of March 31, 2024)
Type of Collateral received

Balance (Millions of Yen)

Securities

Percentage (%)

–

–

–

–

5,881

0.40

2,124

0.14

Merchandise––

Real Estate

163,432

11.02

Foundation

–

–

7,274

0.49

176,587

11.91

Guarantees

6,006

0.40

Unsecured

1,300,548

87.69

1,483,142

100.00including Shares
Claimincluding Deposits

Others
Total

Total

- 48 -

(v) Breakdown of Loans Receivable Outstanding by Period(As of March 31, 2024)
By Period

Balance (Millions ofYen)

Number (Items)

Percentage (%)

1 Year or Less

939

10.96

71,514

4.82

Over 1 Year to 5 Years

890

10.39

524,861

35.39

Over 5 Years to 10 Years

1,000

11.67

575,605

38.81

Over 10 Years to 15 Years

104

1.21

223,937

15.10

Over 15 Years to 20 Years

391

4.56

33,948

2.29

Over 20 Years to 25 Years

1,403

16.37

11,2290.76

Over 25 Years

3,842

44.84

42,046

2.83

8,569

100.001,483,142

100.00Total
Average Period per Case

Percentage (%)

7.28 years(Note) Periods are on a contractual term basis.

- 49 -

5. Material Agreements, etc.
(1) Aircraft Purchase Agreement between JSA International U.S. Holdings, LLC, a Consolidated Subsidiary of the Company,
and Boeing
Contract Company
Name

Contract Year

Contractor

Expected Dateof Receipt

Description of the Contract

Aircraft purchase agreement
Fiscal year
Up to 2026
・Boeing 737 Max 8 22 aircraft
ended March 31,
Boeing(Note 2)
(Note 1)
2019
(Notes) 1. In the fiscal year ended March 31, 2021, the Company entered into an agreement to change the number of aircraft
purchased to 22 from 30 in the initial agreement.
2. In the fiscal year ended March 31, 2023, the Company entered into an agreement to change the expected date ofreceipt in the initial agreement (up to 2025) to the period up to 2026.
JSA International
U.S. Holdings, LLC(2) The Company resolved at the Board of Directors’ meeting held on April 14, 2023 to acquire all of the shares of CenterPoint
Development Inc., an affiliated company accounted for by the equity method, and entered into a share transfer agreement asof the said date. Details are as described in “Notes to Business Combinations” in “1. Consolidated Financial Statements, etc.”of “Item 5. Financial Information.”(3) On November 8, 2023, the Company made the decision to transfer all of its shareholdings in consolidated subsidiaries DFL
Lease Company Limited and Shutoken Leasing Co., Ltd., and concluded a share transfer agreement on the same day. Details
are as described in “Notes to Business Combinations” in “1. Consolidated Financial Statements, etc.” of “Item 5. Financial
Information.”(4) At the Board of Directors meeting held on January 19, 2024, the Company decided to invest (approximately €700 million) in
European Energy A/S (“European Energy”), a Danish company developing and operating renewable and next generationenergy mainly in Europe, and signed an investment agreement to acquire 20% of outstanding shares in European Energy.
Details are as described in “Notes to Significant Subsequent Events” in “1. Consolidated Financial Statements, etc.” of “Item5. Financial Information.”

6.

Research and Development Activities
There is nothing to be noted.

- 50 -

Item 3. Property, Plants and Equipment
1. Leased Assets(1) Overview of Capital Investments
The breakdown of capital investment in leased assets at the Group (the Company and its consolidated subsidiaries) for the
fiscal year under review is as follows.
Category

Acquisition Cost (Millions of Yen)

Operating lease assets

843,262(Note) leased assets transferred from lease investment assets due to the conclusion of a renegotiated lease agreement after thecompletion of a finance lease transaction are not included.
Breakdown of assets sold or retired due to the termination of lease transactions during the fiscal year under review are as
follows.
Category

Book Value (Millions of Yen)

Operating lease assets

213,422(Note) Includes sales and retirement of leased assets under renegotiated lease agreements.
(2) Major Facilities
The breakdown of leased assets at the Group is as follows.
Category

Book Value (Millions of Yen)

Operating lease assets

3,904,046(Note) Includes leased assets under renegotiated lease agreements.
(3) Plans for Capital Investment, Disposal of Property, Plants and Equipment, etc.
There are no plans to build or dispose of important facilities. The Group offers flexible services which are not limited tofinancial functions while utilizing various functions related to tangible and intangible assets, and has not formulated a capital
investment plan that targets only leased assets. Based on contracts, etc. with business partners, assets related to operatingleases, etc. are acquired and disposed of as needed.

2. Assets for own Use(1) Overview of Capital Investments
There is nothing to be noted.
(2) Major Facilities
There is nothing to be noted.
(3) Plans for Capital Investment, Disposal of Property, Plants and Equipment, etc.
There is nothing to be noted.

- 51 -

Item 4. Information on the Company
1. Information on the Company’s Shares, etc.
(1) Total Number of Shares, etc.
(i)

Total Number of Shares
Type

Total Number of Authorized Shares

Common Shares

4,800,000,000

Total

4,800,000,000(ii) Outstanding Shares
Number of Shares issued as ofType

the End of the Fiscal Year
(March 31, 2024)

CommonShares1,466,912,244

Total

1,466,912,244

Number of Shares Issued asof the Date of Submission(June 25, 2024)

1,466,912,244

Name of Financial Instrument Exchange
or Registered Authorized Financial
Instrument Firm Association on which
Shares are listed

Number ofshares per unit

Prime Market of the Tokyo Stock
Exchange

1,466,912,244

Description

100

―

―

(Note) On April 25, 2024, the Company submitted an application for the delisting of its shares from Nagoya Stock Exchange, with thedelisting taking place on June 15, 2024.
(2) Share Acquisition Rights, etc.
(i)

Description of the Stock Option Plan

Date of Resolution

Category and Number of Grantees (Persons)September 27, 2012

September 26, 2013

Directors of the Company: 10

Directors of the Company: 10(excluding Outside Directors)
Executive Officers of the Company:(excluding Outside Directors)
Executive Officers of the Company:

17(excluding those concurrently

19(excluding those concurrently

holding positions as directors)

holding positions as directors)

Number of Share Acquisition Rights*
Class, Description and Number of Shares to be issued
upon Exercise of Share Acquisition Rights*[47,100] (Note 1)¥1 per share

Acquisition Rights*

Issue Price of Shares and Additional paid-in Capitalper Share if Shares are issued upon Exercise of Share
Acquisition Rights*[471]
Common Shares
57,900 (Note 1)

Common Shares
37,500 (Note 1)

Amount to be paid upon Exercise of Share

Exercise Period of Share Acquisition Rights*

579

375

From October 16, 2012

From October 16, 2013

to October 15, 2042

to October 15, 2043

Issue Price: ¥312.9

Issue Price: ¥503

Additional paid-in capital per share:¥156.5Additional paid-in capital per share:¥252

Conditions for exercise of Share Acquisition Rights*(Note 2)Matters concerning the transfer of Share Acquisition

Acquisition of share acquisition rights by transfer shall be subject to theapproval of the Board of Directors of the Company by its resolution.

Rights*Matters concerning the Delivery of Share Acquisition
Rights in Connection with Organizational
Restructuring*(Note 3)- 52 -

Date of Resolution

Category and Number of Grantees (Persons)September 25, 2014

September 29, 2015

Directors of the Company: 10

Directors of the Company: 9(excluding Outside Directors)
Executive Officers of the Company:(excluding Outside Directors)
Executive Officers of the Company:

18(excluding those concurrently

20(excluding those concurrently

holding positions as directors)

holding positions as directors)

1,133[1,039]1,568[1,436]

Common Shares
113,300 (Note 1)

Common Shares
156,800 (Note 1)[103,900] (Note 1)[143,600] (Note 1)

Number of Share Acquisition Rights*
Class, Description and Number of Shares to be issued
upon Exercise of Share Acquisition Rights*
Amount to be paid upon Exercise of Share
Acquisition Rights*
Exercise Period of Share Acquisition Rights*
Issue Price of Shares and Additional paid-in Capitalper Share if Shares are issued upon Exercise of Share
Acquisition Rights*¥1 per share
From October 16, 2014
to October 15, 2044

From October 16, 2015
to October 15, 2045

Issue Price: ¥491

Issue Price: ¥547

Additional paid-in capital per share: Additional paid-in capital per share:
¥246
¥274

Conditions for exercise of Share Acquisition Rights*(Note 2)Matters concerning the transfer of Share Acquisition

Acquisition of share acquisition rights by transfer shall be subject to theapproval of the Board of Directors of the Company by its resolution.

Rights*Matters concerning the Delivery of Share Acquisition
Rights in Connection with Organizational
Restructuring*
Date of Resolution

Category and Number of Grantees (Persons)(Note 3)September 29, 2016

September 27, 2017

Directors of the Company: 9

Directors of the Company: 9(excluding Outside Directors)
Executive Officers of the Company:(excluding Outside Directors)
Executive Officers of the Company:

20(excluding those concurrently

27(excluding those concurrently

holding positions as directors)

holding positions as directors)

2,316

Number of Share Acquisition Rights*
Class, Description and Number of Shares to be issued
upon Exercise of Share Acquisition Rights*[2,201][3,089]Common Shares
231,600 (Note 1)

Common Shares
336,700 (Note 1)[220,100] (Note 1)[308,900] (Note 1)

Amount to be paid upon Exercise of Share¥1 per share

Acquisition Rights*
Exercise Period of Share Acquisition Rights*
Issue Price of Shares and Additional paid-in Capitalper Share if Shares are issued upon Exercise of Share
Acquisition Rights*

3,367

From October 15, 2016
to October 14, 2046

From October 14, 2017
to October 13, 2047

Issue Price: ¥437
Additional paid-in capital per share:

Issue Price: ¥567
Additional paid-in capital per share:

¥219

¥284

Conditions for exercise of Share Acquisition Rights*(Note 2)Matters concerning the transfer of Share Acquisition
Rights*Acquisition of share acquisition rights by transfer shall be subject to theapproval of the Board of Directors of the Company by its resolution.

Matters concerning the Delivery of Share Acquisition
Rights in Connection with Organizational
Restructuring*(Note 3)

- 53 -

Date of Resolution

Category and Number of Grantees (Persons)June 28, 2018

June 25, 2019

Directors of the Company: 6(excluding Outside Directors)

Directors of the Company: 5(excluding Outside Directors)

Executive Officers of the Company:
33

Executive Officers of the Company:
30(excluding those concurrently
holding positions as directors)(excluding those concurrently
holding positions as directors)

Number of Share Acquisition Rights*

2,875

3,842

Class, Description and Number of Shares to be issued

Common Shares

Common Shares

upon Exercise of Share Acquisition Rights*

287,500 (Note 1)

384,200 (Note 1)

Amount to be paid upon Exercise of Share Acquisition¥1 per share

Rights*Exercise Period of Share Acquisition Rights*

From July 14, 2018
to July 13, 2048

From July 13, 2019
to July 12, 2049

Issue Price: ¥591
Issue Price of Shares and Additional paid-in Capitalper Share if Shares are issued upon Exercise of Share Additional paid-in capital per share:
Acquisition Rights*¥296
Conditions for exercise of Share Acquisition Rights*

Issue Price: ¥514
Additional paid-in capital per share:¥257(Note 2)Matters concerning the transfer of Share Acquisition Acquisition of share acquisition rights by transfer shall be subject to theapproval of the Board of Directors of the Company by its resolution.
Rights*Matters concerning the Delivery of Share Acquisition
Rights in Connection with Organizational
Restructuring*(Note 3)

- 54 -

Date of Resolution

June 24, 2020

June 25, 2021
Directors of the Company: 6

Category and Number of Grantees (Persons)

Directors of the Company: 5(excluding Outside Directors)(excluding Outside Directors andDirectors who are Audit &Executive Officers of the Company:
31

Supervisory Committee Members)
Executive Officers of the Company:(excluding those concurrently
holding positions as directors)

55(excluding those concurrently
holding positions as directors)

4,003

8,411
[8,211]

Class, Description and Number of Shares to be issued

Common Shares

upon Exercise of Share Acquisition Rights*

400,300 (Note 1)

Common Shares
841,100 (Note 1)

Number of Share Acquisition Rights*

Amount to be paid upon Exercise of Share Acquisition
Rights*Exercise Period of Share Acquisition Rights*[821,100] (Note 1)¥1 per share

From July 16, 2020
to July 15, 2050

From July 16, 2021
to July 15, 2051

Issue Price: ¥425
Issue Price of Shares and Additional paid-in Capitalper Share if Shares are issued upon Exercise of Share Additional paid-in capital per share:
Acquisition Rights*¥213
Conditions for exercise of Share Acquisition Rights*(Note 2)

Issue Price: ¥500
Additional paid-in capital per share:¥250(Note 4)

Matters concerning the transfer of Share Acquisition Acquisition of share acquisition rights by transfer shall be subject to theapproval of the Board of Directors of the Company by its resolution.
Rights*Matters concerning the Delivery of Share Acquisition
Rights in Connection with Organizational
Restructuring*(Note 3)- 55 -

Date of Resolution

June 28, 2022
Directors of the Company: 6(excluding Outside Directors andDirectors who are Audit &Category and Number of Grantees (Persons)Supervisory Committee Members)
Executive Officers of the Company:
55(excluding those concurrently
holding positions as directors)

Number of Share Acquisition Rights*

8,554

Class, Description and Number of Shares to be issued
upon Exercise of Share Acquisition Rights*

Common Shares
855,400 (Note 1)

Amount to be paid upon Exercise of Share Acquisition
Rights*¥1 per share

Exercise Period of Share Acquisition Rights*

From July 16, 2022
to July 15, 2052

Issue Price: ¥512
Issue Price of Shares and Additional paid-in Capitalper Share if Shares are issued upon Exercise of Share Additional paid-in capital per share:
Acquisition Rights*¥256
Conditions for exercise of Share Acquisition Rights*(Note 4)

Acquisition of share acquisitionrights by transfer shall be subject toMatters concerning the transfer of Share Acquisition
the approval of the Board of
Rights*Directors of the Company by its
resolution.
Matters concerning the Delivery of Share Acquisition
Rights in Connection with Organizational(Note 3)
Restructuring** Description as of the last day of the fiscal year under review (March 31, 2024) is presented. For matters that changed from the last
day of the fiscal year under review to the end of the month before the submission date (May 31, 2024), the description as of the endof the month before the submission date is described in [ ], and for other matters, there is no change from the description as of thelast day of the fiscal year under review.
(Notes) 1. The class of shares to be issued upon exercise of the share acquisition rights shall be common shares, and the number ofshares to be issued upon exercise of each share acquisition right (hereinafter referred to as the “Number of Shares Granted”)
shall be 100 shares.
If the Company splits its common shares (including gratis allotment of shares of common shares of the Company; the same
shall apply hereinafter to the description of a share split) or consolidates its common shares after the date on which theshare acquisition rights are allotted (hereinafter referred to as the “Allotment Date”), the Number of Shares Granted shallbe adjusted according to the following formula; provided, however, that such adjustment shall be made to the number ofshares underlying the share acquisition rights that have not been exercised at the time of such adjustment, and any fraction
less than one share arising from such adjustment shall be discarded.
Number of Shares Granted after adjustment = Number of Shares Granted before adjustment × Ratio of stock split or stock
consolidation
Number of Shares Granted after adjustment shall apply in the case of a stock split on or after the day following the record
date of such stock split (if the record date is not specified, the effective date thereof) and in the case of a stock consolidation
on or after the effective date thereof; provided, however, that in cases where a stock split is carried out on the condition
that a proposal to increase share capital or capital reserve by reducing the amount of surplus is approved at the General
Meeting of Shareholders of the Company, and where the record date for the stock split is a day on or before the date ofconclusion of such General Meeting of Shareholders, the Number of Shares Granted after adjustment shall apply on orafter the day following the date of conclusion of such General Meeting of Shareholders.

- 56 -

In addition to the above, if the Company carries out a merger, company split or share exchange or otherwise requires anadjustment to the Number of Shares Granted after the Allotment Date, the Company may make an adjustment to the
Number of Shares Granted as deemed necessary by the Board of Directors of the Company.
2. (1) In addition to the period within “Exercise Period of Share Acquisition Rights,” share acquisition right holders may
exercise share acquisition rights within a period not exceeding five years from the date on which one year has passed
from the date following the date on which they lost their positions as Directors, Corporate Auditors, Executive
Officers, etc. of the Company.
(2) Notwithstanding (1) above, if a proposal for approval of a merger agreement under which the Company will become
an extinct company, a proposal for approval of a company split agreement or company split plan under which theCompany will become a splitting company, or a proposal for approval of a share exchange agreement or share transfer
plan under which the Company will become a wholly owned subsidiary is approved at the General Meeting of
Shareholders of the Company (if a resolution of the General Meeting of Shareholders is not required, a resolution of
the Board of Directors of the Company is adopted), share acquisition rights may be exercised within 30 days from the
day following the date of such approval; provided, however, that this shall not apply to cases where the share acquisitionrights of the restructured company are delivered to the share acquisition right holders in accordance with the mattersrelated to delivery of share acquisition rights in accordance with the organizational restructuring as set forth in (Note3) below.
(3) Other conditions shall be as set forth in the “Share Option Allotment Agreement” to be concluded between the
Company and the share acquisition right holders.
3. In the event the Company merges (only if the Company disappears as a result of merger), performs an absorption-typecompany split or an incorporation-type company split (only if the Company is to be a splitting company), or conducts ashare exchange or a share transfer (only if the Company becomes a wholly owned subsidiary) (hereinafter collectively
referred to as “Organizational Restructuring”), share acquisition rights of a corporation described in Article 236, Paragraph
1, Item (viii) (a) through (e) of the Companies Act (hereinafter referred to as “Restructured Company”) shall be delivered
respectively to share acquisition right holders remaining unexercised (hereinafter referred to as “Remaining Share
Acquisition Rights”) immediately prior to the effective day of Organizational Restructuring (this means the day on which
an absorption-type merger becomes effective with regard to an absorption-type merger, the day of formation of the stockcompany incorporated in the consolidation-type merger with regard to a consolidation-type merger, the day on which anabsorption-type company split becomes effective with regard to an absorption-type company split, the day of formation of
the stock company incorporated in the incorporation-type split with regard to an incorporation-type company split, the dayon which a share exchange becomes effective with regard to a share exchange, and the day of formation of the wholly
owning parent company incorporated in the share transfer with regard to a share transfer; the same shall apply hereinafter);provided, however, that the delivery of share acquisition rights of the Restructured Company in accordance with thefollowing items shall be subject to the provisions of the absorption-type merger agreement, consolidation-type merger
agreement, absorption-type company split agreement, incorporation-type company split plan, share exchange agreement
or share transfer plan.
(1) Number of Share Acquisition Rights of the restructured Company to be delivered
The same number of share acquisition rights as the number of remaining share acquisition rights held by the shareacquisition right holders shall be delivered respectively.
(2) Class of Shares of the Restructured Company to be issued upon Exercise of Share Acquisition Rights
Common shares of the Restructured Company.
(3) Number of Shares of the Restructured Company to be issued upon Exercise of Share Acquisition Rights
To be decided according to (Note 1) above after taking into consideration the conditions, etc. of the Organizational
Restructuring(4) Value of Assets to be contributed upon Exercise of Share Acquisition Rights
Value of assets to be contributed upon the exercise of each share acquisition right to be delivered shall be the amountobtained by multiplying the exercise price after restructuring as specified below by the number of shares of the
Restructured Company to be issued for each share acquisition right as determined in accordance with (3) above. The
exercise price after restructuring shall be 1 yen per share of the Restructuring Company that can be delivered byexercising each share acquisition right to be delivered.
(5) Period during which Share Acquisition Rights can be exercised
Starting from the later of either the initial date of the exercise period of share acquisition rights as stipulated in the“Exercise Period of Share Acquisition Rights” or the date on which the Organizational Restructuring becomes effective
and ending on the expiration date for the exercise of share acquisition rights as stipulated in the “Exercise Period of
Share Acquisition Rights.”- 57 -

(6) Matters concerning increase in Share Capital and Capital Reserve by issuing of Shares upon Exercise of Share
Acquisition Rights(i) Amount of share capital to be increased with the issuance of shares upon exercise of share acquisition rights shall be
1/2 of the maximum amount of increase in share capital as calculated in accordance with Article 17, Paragraph 1 of
the Regulations on Corporate Accounting, and where any fraction less than one yen arises as a result of the calculation,such fraction shall be rounded up.
(ii) Amount of capital reserve to be increased with the issuance of shares upon exercise of share acquisition rights shallbe the maximum amount of increase in share capital as described in (i) above less the amount of share capital increase
as described in (i) above.
(7) Restriction on the Acquisition of Share Acquisition Rights by Transfer
Acquisition of share acquisition rights by transfer shall be subject to the approval of the board of directors of the
Restructured Company by its resolution.
(8) Conditions for Exercise of Share Acquisition Rights
To be determined in accordance with (Note 2) above or (Note 4) below.
(9) Terms of Acquisition of Share Acquisition Rights
The Company may acquire share acquisition rights on the date specifically determined by the Board of Directors of
the Company without any compensation if proposals (i), (ii), (iii), (iv) or (v) below are approved by the General
Meeting of Shareholders of the Company (if a resolution of the General Meeting of Shareholders is not required, aresolution of the Board of Directors of the Company is adopted).
(i) Proposal to approve a merger agreement under which the Company will become an extinct company(ii) Proposal to approve a company split agreement or a company split plan under which the company will become asplitting company(iii) Proposal to approve a share exchange agreement or share transfer plan under which the Company will become awholly owned subsidiary(iv) Proposal to approve an amendment to the Articles of Incorporation to create a provision, as a feature of all sharesissued by the Company, that the approval of the Company shall be required for the acquisition of such shares bytransfer(v) Proposal to approve an amendment to the Articles of Incorporation to create a provision that, as a feature of a classof shares underlying share acquisition rights, approval of the Company shall be required for the acquisition of suchclass of shares by transfer, or that the Company shall acquire all of such class of shares by resolution of a General
Meeting of Shareholders of the Company
4. (1) In addition to the period within “Exercise Period of Share Acquisition Rights,” share acquisition right holders may
exercise share acquisition rights within a period not exceeding five years from the date on which one year has passed
from the date following the date on which they lost their positions as Directors or Executive Officers, etc. of theCompany.
(2) Notwithstanding (1) above, if a proposal for approval of a merger agreement under which the Company will become
an extinct company, a proposal for approval of a company split agreement or company split plan under which theCompany will become a splitting company, or a proposal for approval of a share exchange agreement or share transfer
plan under which the Company will become a wholly owned subsidiary is approved at the General Meeting of
Shareholders of the Company (if a resolution of the General Meeting of Shareholders is not required, a resolution of
the Board of Directors of the Company is adopted), share acquisition rights may be exercised within 30 days from the
day following the date of such approval; provided, however, that this shall not apply to cases where the share acquisitionrights of the restructured company are delivered to the share acquisition right holders in accordance with the mattersrelated to delivery of share acquisition rights in accordance with the organizational restructuring as set forth in (Note3) above.
(3) Other conditions shall be as set forth in the “Share Option Allotment Agreement” to be concluded between the
Company and the share acquisition right holders.
(ii) Rights Plan
Not applicable.
(iii) Other Share Acquisition Rights, etc.
Not applicable.

- 58 -

(3) Exercises, etc., of Moving Strike Convertible Bonds, etc.
Not applicable.
(4) Changes in Number of Issued Shares, Share Capital, etc.

Date

Changes in
Number ofIssued Shares(Thousands ofShares)Balance of
Number ofIssued Shares(Thousands ofShares)Changes inShare Capital(Millions of
Yen)

Balance ofShare Capital(Millions of
Yen)

Changes in
CapitalReserve(Millions of
Yen)

Balance ofCapitalReserve(Millions ofYen)

April 1, 2021

571,078

1,466,912–

33,196–33,802(Note) As a result of the merger of Mitsubishi UFJ Lease & Finance Company Limited and Hitachi Capital Corp. (merger ratio: 1: 5.1)
on April 1, 2021, the total number of issued shares increased 571,078 thousand shares to 1,466,912 thousand shares.

(5) Shareholding by Shareholder Category(As of March 31, 2024)
Status of Shares (100 Shares per Unit)
Financial
Institutions

Financial
Instruments
Business
Operators

Other
Corporations

–

84

45

Number of
Shares held
(Units)–3,623,981

Shareholding
Ratio (%)

–

24.74

Category

National and
Local
Governments

Number of
Shareholders

Foreign Shareholders

Individuals
and Others

Total

Shares Less
than One
Unit(Shares)

Other than
Individuals

Individuals

1,436

585

580

335,262

337,992–

359,411

5,139,351

2,699,117

2,967

2,822,929

14,647,756

2,136,644

2.45

35.09

18.43

0.02

19.27

100.00–(Note) 29,804,554 shares of treasury shares are stated in “Individuals and Others,” including 298,045 units, and 54 shares in Sharesless than one unit.

- 59 -

(6) Major Shareholders

Name

Location

Mitsubishi Corporation

3-1 Marunouchi 2-chome, Chiyoda-ku, Tokyo

Mitsubishi UFJ Financial Group,Inc.

7-1 Marunouchi 2-chome, Chiyoda-ku, Tokyo

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

8-1 Akasaka 1-chome, Minato-ku, Tokyo

Custody Bank of Japan, Ltd.

8-12 Harumi 1-chome, Chuo-ku, Tokyo

Number of
Shares held(Thousands ofShares)(Trust Account)
MUFG Bank, Ltd.

7-1 Marunouchi 2-chome, Chiyoda-ku, Tokyo

Mitsubishi UFJ Trust and4-5 Marunouchi 1-chome, Chiyoda-ku, Tokyo

Banking Corporation (Note)
Meiji Yasuda Life Insurance

1-1 Marunouchi 2-chome, Chiyoda-ku, Tokyo

Company
STATE STREET BANK WEST
CLIENT - TREATY 505234

1776 HERITAGE DRIVE, NORTH QUINCY,(Standing proxy: Settlement &Clearing Services Department,

MA 02171, U.S.A.
(15-1 Konan 2-chome, Minato-ku, Tokyo)(As of March 31, 2024)
Ownership
Percentage to the
Total Number ofissued Shares(excluding Treasury
Shares) (%)

264,04418.37

208,345

14.49

125,6178.74

65,927

4.58

50,3483.50

28,431

1.97

27,9901.94

16,345

1.13

12,0190.83

11,4190.79

810,490

56.39

Mizuho Bank, Ltd.)JP MORGAN CHASE BANK
385632(Standing proxy: Settlement &25 BANK STREET, CANARY WHARF,LONDON, E14 5JP, UNITED KINGDOM

Clearing Services Department,
Mizuho Bank, Ltd.)(15-1 Konan 2-chome, Minato-ku, Tokyo)

Tokio Marine & Nichido Fire
Insurance Co., Ltd.
Total

6-4 Otemachi 2-chome, Chiyoda-ku, Tokyo–(Note) Shares in trust business is not included for Mitsubishi UFJ Trust and Banking Corporation.

- 60 -

(7) Voting Rights(i)Issued Shares
Category

Number of Shares (Shares)

Shares without Voting Rights

Number of Voting
Rights (Units)(As of March 31, 2024)
Description

–

–

–

–

–

–

–

–

–

29,804,500––

1,434,971,100

14,349,711–

2,136,644––

Total Number of issued Shares

1,466,912,244––

Total Number of Voting Rights–

14,349,711–

Shares with restricted Voting Rights(Treasury Shares, etc.)
Shares with restricted Voting Rights(Others)
Shares with full Voting Rights (Treasury
Shares, etc.)

CommonsharesCommonShares with full Voting Rights (Others)

sharesCommonShares Less than One Unit

shares(Notes) 1. The shares of common shares in the “Shares with full Voting Rights (Others)” and “Shares Less than One Unit” columns
include 6,100 Company shares (61 voting rights) and 20 Company shares, respectively, held by Japan Securities Depository
Center, Incorporated.
2. The shares of common stock in the “Shares with full Voting Rights (Others)” and “Shares Less than One Unit” columns
include 2,685,200 Company shares (26,852 voting rights) and 68 Company shares, respectively, held by a trust under the
performance-based stock compensation plan.
(ii) Treasury Shares, etc.
(As of March 31, 2024)
Numberof Shares
held under
the Namesof Others(Shares)Name of Shareholders

Address of Shareholders

Number of
Shares held
under own
Name (Shares)

Mitsubishi HC Capital Inc.

5-1, Marunouchi 1-chome,
Chiyoda-ku, Tokyo

29,804,500–

29,804,500

2.03

–

29,804,500–

29,804,500

2.03

Total
(Note)

Total Shares
held (Shares)

Ownership
Percentage to the
Total Number ofissued Shares (%)

In addition to the Number of Shares held under own Name of 29,804,554 shares (including 54 shares less than one unit),
2,685,268 of the Company’s shares held by a trust under the performance-based stock compensation plan are recorded astreasury shares in the financial statements.

(8) Description of Officers’ and Employees’ Shareholding Plan
The Company resolved at the 52nd Annual General Meeting of Shareholders held on June 27, 2023 to adopt a performancebased stock compensation plan that uses a trust (hereinafter, the “Plan”) for Directors (excluding non-Executive Directors andnon-residents in Japan) excluding Directors who are Audit & Supervisory Committee Members and Executive Officers, etc.
(excluding non-residents in Japan; hereinafter, the Directors and the Executive Officers, etc. are collectively referred to as the“Director(s), etc.”).

- 61 -

(i)Outline of the Plan
The Plan is a stock compensation plan where the Company shares and cash equivalent to the conversion value of the Company
shares (hereinafter, the “Company Shares, etc.”) are delivered or paid (hereinafter, the “Delivery, etc.”) to the Directors, etc.,
based on the achievement level of performance targets of the Medium-term Management Plan of the Company. The Company
entrusts money to a trust bank to acquire, in advance, the Company shares of which the Delivery, etc. will be conducted in the
future, and the trust bank acquires the Company shares with the entrusted money. Furthermore, in accordance with theseparately established company rules on the regulations for share delivery, points are granted to the Directors, etc. and the
Deliver, etc. of the Company Shares, etc. to the Directors, etc. is conducted according to the points. The initial trust term shallbe approximately three years from August 2023 to August 2026 (planned), corresponding to the period of the Medium-termManagement Plan, and the maximum amount of trust money contributed by the Company to the trust in the initial trust term
shall be ¥2.4 billion.
Class of Trust

Monetary trust other than a specified solely administered monetary trust (third-party benefit

Purpose of Trust

Granting of incentives to Directors, etc.

Settlor

The Company

Trustee

Mitsubishi UFJ Trust and Banking Corporation

trust)(Joint trustee: The Master Trust Bank of Japan, Ltd.)
Beneficiaries

Directors, etc. (including retired individuals) who fulfill the beneficiary requirements

Trust Administrator

A third party who has no interest in the Company

Date of Change inAugust 15, 2023

Trust Agreement(The Company inherited an agreement concluded by the former Hitachi Capital Corporation,and has changed the contents.)

Trust Period

August 15, 2023 to August 31, 2026 (planned)

Date of

August 15, 2023

Commencement of the
Plan
Exercise of Voting

Voting rights will not be exercised

RightsClass of Shares

Common shares of the Company

Acquired
Method of acquiring

Acquisition in the stock market

SharesRights Holder

The Company

Residual Assets

As the rights holder, the Company may receive residual assets to the extent of the trust’s
reserves.

(ii) Total Number of Shares of which Delivery, etc. to the Directors, etc. will be conducted
4,650 thousand shares (maximum number for the three years)(iii) Scope of Persons who can receive Beneficiary Rights and other Rights under the Plan
Of the Directors, etc., persons who meet the beneficiary requirements separately stipulated in the company rules on theregulations for share delivery- 62 -

2.

Acquisitions, etc. of Treasury SharesClass of Shares, etc.- Acquisition of shares of common shares pursuant to Article 155, Item 7 of the Companies Act(1) Acquisitions by a Resolution of the General Meeting of Shareholders
Not applicable.
(2) Acquisitions by a Resolution of the Board of Directors
Not applicable.
(3) Acquisitions Not based on a Resolution of the General Meeting of Shareholders or the Board of Directors
Category

Number of Shares (Shares)

Total Amount (Yen)Treasury Shares Acquired during the Fiscal Year under Review

596

543,542

Treasury Shares Acquired during the Period

93

94,379(Note) The treasury shares acquired during the period do not include shares purchased for fractional shares from June 1, 2024 until thedate of submission of this Annual Securities Report.
(4) Disposals or Holding of Acquired Treasury Shares
During the Fiscal Year under Review
Category

Acquired Treasury Shares that were offered to
Subscribers for Subscription
Acquired Treasury Shares that were canceled

Number of Shares(Shares)

Total Disposal
Amount(Yen)

During the period
Number of Shares(Shares)

Total Disposal
Amount
(Yen)

–

–

–

–

–

–

–

–

–

–

–

–

612,200

612,200

92,70092,70029,804,554–

29,711,947–

Acquired Treasury Shares that were transferred
due to Merger, Exchange of Shares, Issue of
Shares or Corporate Split
Others (Note 1)
Number of Treasury Shares held

(Notes) 1. The disposal of treasury shares acquired during the fiscal year under review and the period is due to the exercise of shareacquisition rights.
2. The number of treasury shares to be disposed of during the period does not include the sale of shares constituting less than
one unit and the exercise of share acquisition rights from June 1, 2024 to the submission date of this Annual Securities
Report.
3. The number of treasury shares held during the period does not include any increase or decrease due to the purchase or saleof shares constituting less than one unit and the exercise of share acquisition rights from June 1, 2024 to the submission
date of this Annual Securities Report.

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3.

Dividend Policy
The Company’s basic policy is to return profits to shareholders through dividends.
The Company’s basic policy is to pay dividends of surplus twice a year, consisting of an interim dividend and a year-end dividend.
Pursuant to Article 459, Paragraph 1 of the Companies Act, the Company’s Articles of Incorporation stipulate that dividends ofsurplus may be paid by resolution of the Board of Directors.
The Company is subject to consolidated dividend regulations.
As stated in “(4) Target Performance Indicators, 1. Management Policy, Business Environment and Tasks Ahead, etc., Item 2.
Business Overview,” a medium-term target level for the payout ratio shall be 40% or more for the three-year period from fiscal
2023 (the fiscal year ended March 31, 2024), the period covered by the Medium-term Management Plan (2025 MTMP). We will
increase the total amount of dividend payment through profit growth.
The Company will make effective use of retained earnings for future management by allocating it to funds for the purchase ofhigh-quality operating assets.
Dividends of surplus for the fiscal year under review are as follows.
Date of Resolution
November 10, 2023
Board of Directors’ Resolution
May 22, 2024
Board of Directors’ Resolution

Total Dividend Amount(Millions of Yen)

Dividend per Share(Yen)

25,86618.00

27,30519.00- 64 -

4.

Corporate Governance, etc.
(1) Overview of Corporate Governance(i) Basic Stance on Corporate Governance
While emphasizing initiatives to achieve sustainable corporate growth and a medium-to long-term improvement in corporate
value, the Company aspires to contribute to a more prosperous society by respecting the rights and interests of all of its
stakeholders—shareholders, customers, local communities, and employees—and fulfilling their trust in the Company.
With the recognition that it is one of its social responsibilities to ensure transparent and sound management, the Company
continues to work on initiatives to enhance corporate governance by boosting the activity of the Board of Directors,
reinforcing the Audit & Supervisory Committee and the internal audit system, ensuring timely and appropriate disclosuresof information, and actively engaging in investor relations (IR) and other activities.
Basic Policy on Corporate GovernanceFostering sound Corporate Culture
In accordance with Our Vision, which guides all of the Company’s activities, and the Mitsubishi HC Capital Group Codeof Ethics and Code of Conduct, which serves as the standard for the decisions and behaviors of all employees, the Company
strives to understand the diversity of its various stakeholders including shareholders, customers, local communities, andemployees and foster a corporate culture that respects their rights and perspectives and sound corporate ethics.
Appropriate Information Disclosure and Transparency
The Company conducts proactive and continuous information disclosure in order to be trusted and properly evaluated byeach of its stakeholders. In addition, the Company will develop and properly operate an internal system for accurate,
prompt and fair disclosure of information on the Company’s management policies, business strategies, business activities
and financial conditions.
In addition to the items required to be disclosed by laws and regulations, the Company voluntarily and proactively discloses
non-financial information that is deemed useful to its stakeholders.
Securing the Rights and Equality of Shareholders
The Company takes appropriate steps to ensure that the rights of shareholders are secured and can be exercised effectively
and all shareholders including minority shareholders and foreign shareholders are treated equally.
Constructive Dialogue with Shareholders
Through events such as general shareholders meetings, financial results briefings and other domestic and overseas investor
relations (IR) events, the Company pursues proactive and constructive dialogue with diverse shareholders. It thereby seeks
to gain understanding from shareholders regarding matters such as its business strategies and further enhance corporate
governance through dialogue.
Ensuring Effectiveness of the Board of Directors
All members of the Board of Directors, including Outside Directors, call upon their experience and insight as they engage
in free and open discussions, supporting appropriate risk-taking. In this manner, they adequately fulfill their duties andresponsibilities to achieve the sustainable growth of the Company, medium-to long-term improvement of its corporate
value, and enhancement of its capital efficiency.

- 65 -

Mitsubishi HC Capital Group’s Code of Ethics
Establishing Trust
Fully recognizing the weight of our social responsibility and public mission, the Company aims to establish the unshaken
trust of society through complete information management and sound and proper business activities, including the timely
and appropriate disclosure of company information.
Customer-oriented Approach
Consistently taking a customer-oriented approach and having good communication, the Company offers products andservices that best meet customers’ needs to obtain customers’ satisfaction and support.
Strict Compliance with Laws and Regulations
The Company strictly adheres to all applicable laws, regulations, and rules (including social, industry, and company rules)
and undertakes appropriate and sincere corporate activities in line with social norms. The Company also respects
internationally accepted standards as a corporate group operating globally.
Respect for Human Rights and the Environment
Respecting the personality and character of each other and emphasizing conservation of the global environment that is theshared asset of humankind, The Company pursues harmony with society.
Exclusion of Anti-Social Elements/Money-Laundering Prevention
The Company takes a resolute stance against anti-social elements that threaten the order and safety of civil society.
In compliance with all applicable laws and regulations related to preventing money laundering, the Company takes every
possible measure to block money laundering and terrorist financing.

- 66 -

(ii) Corporate Governance Systema.

Overview of Corporate Governance Systems
The Company is a company with an audit & supervisory committee, and has established a Board of Directors to be responsiblefor important decision-making and supervisory functions, and an Audit & Supervisory Committee to be responsible for audit
and supervisory functions.
In addition, to further enhance its corporate governance, the Company has established the Nomination Committee and theCompensation Committee, as advisory bodies to the Board of Directors related to the nomination of the President,
remuneration for Directors, and other matters. The Company has also established the Governance Committee, which consistsof Outside Directors, Representative Directors, and others, as an organization that gives the Board of Directors advice related
to matters including improvement of its effectiveness.
Alongside adopting an executive officer system, the Company has established an Executive Committee to serve as a body fordeliberation and decision-making on important management matters.
i)

ii)

Matters concerning the Board of Directors and the Audit & Supervisory Committee
The Company implements a system to manage and operate business in line with the basic policy decided by the Board of
Directors. Each Outside Director has qualities appropriate for their positions, giving the Board of Directors a set ofdiversified and sufficient skills.
In addition, for timely, appropriate, and smooth provision of information particularly to Outside Directors, the General
Affairs Department serves as the secretariat for the Board of Directors, and the Audit & Supervisory Committee Officehas been established which assists the duties of the Audit & Supervisory Committee.
Each year, all Directors conduct a review and evaluation of the Board of Directors over the previous year. In addition,
discussions only by Independent Outside Directors are held regularly, and in the event that an issue, etc. is raised there, itwill be appropriately responded to and improved.
Please refer to “(3) Status of the Audit” in “4. Corporate Governance, etc.” in “Item 4. Information on the Company” formatters concerning the Audit & Supervisory Committee.
Matters concerning the Governance Committee, the Nominating Committee and the Compensation Committee
The Company has established the Governance Committee, which is composed of Outside Directors, Representative
Directors, and others. It will widely exchange opinions on the enhancement of the effectiveness of the Board of Directors,
and other matters concerning the Board of Directors, and continue to work on enhancing the soundness, transparency, andfairness of the Company’s management.
Based on the recognition that appropriate involvement of Independent Outside Directors is extremely important forresolutions related to nomination and remuneration, the Company has established the Nomination Committee andCompensation Committee, of which Independent Outside Directors comprise the majority, and which are advisory bodies
for the Board of Directors.
The Nomination Committee will deliberate on matters such as the nomination of Directors, the succession plan for the
President & CEO, and the knowledge, experience, and skills that Directors should possess.
The Compensation Committee will utilize an external expert organization to regularly monitor the comparison between
the Company’s remuneration system for Directors and the market level, and deliberate on policies concerning thecompensation systems, levels, etc. for Directors.
The members and chairperson of the Nomination and Compensation Committees are selected by the Board of Directors,
and matters for deliberation at the Committees shall be resolved by a majority of the members present. The internal rules
stipulate that the Board of Directors shall make resolutions by respecting the contents of the resolutions of the Committees.

- 67 -

List of the Members in the respective Organizations
Name

Title

Board ofDirectors

Takahiro Yanai

Director, Chairman

Taiju Hisai

Audit &
Supervisory
Committee

GovernanceCommittee

Nominating
Committee◎◎◎

Representative Director
President & CEO〇〇

Aiichiro Matsunaga

Representative Director
Deputy President〇〇

Kazumi Anei

Director
Deputy President〇

Haruhiko Sato

Director
Managing Executive
Officer〇

Yuri Sasaki

Director(Independent Outside
Director)

〇

〇

〇

〇

Kayoko Kawamura

Director(Independent Outside
Director)

〇

〇

〇

〇

Shota Kondo

Director(Outside Director)

〇

〇

〇

〇

Yoshitaka Shiba

Director (Audit &Supervisory Committee
Member)〇◎〇Hiroyasu Nakata

Director (Audit &Supervisory Committee
Member)(Independent Outside
Director)

〇

〇

〇

〇

〇

Hiroko Kaneko

Director (Audit &Supervisory Committee
Member)(Independent Outside
Director)

〇

〇

〇

〇

〇

Masayuki Saito

Director (Audit &Supervisory Committee
Member)(Independent Outside
Director)

〇

〇

〇

〇

〇

(Note)

Compensation
Committee◎◎: Chairperson/Committee Chairperson, ○: Memberiii) Matters concerning Business Execution
As a company with an audit & supervisory committee, the Company delegates the business execution decisions to the
Executive Committee in an appropriate manner, a body which will deliberate and decide on important management
matters, and expedites the decision-making process, with the aim of strengthening the supervisory functions of the Boardof Directors. In addition, the Company has introduced an executive officer system, in order to further enhance andinvigorate the functions of the Board of Directors by clarifying the responsibilities related to the execution of business.
The Executive Committee, a body which will deliberate and decide on important management matters, is composed of
the President & CEO, Deputy President, and Executive Officers separately specified by the President & CEO. The
Committee will hold deliberations and make decisions on important matters, including the business management of theGroup, in addition to conducting preliminary deliberations of matters that are to be submitted to the Board of Directors
to facilitate decision-making by the Board of Directors.
The Company has 26 Executive Officers (four of whom concurrently serve as Directors) as of June 25, 2024.
iv) Reasons for Adoption of current Corporate Governance System
In order to enhance the transparency and fairness of management, strengthen the supervisory functions of the Board of
Directors, and enhance corporate governance, the Company adopted the institutional design of a company with an audit& supervisory committee.

- 68 -

b. Status of Activities of the Board of Directors and each Committee (Frequency of Meetings, specific Discussion Items,
Attendance of Directors and Committee Members)i) Board of Directors
The Board of Directors meetings are held every month, in principle. The meetings were held 15 times in FY2023, whereimportant management matters such as the Medium-term Management Plan, major investment projects, businessstrategies of each business division, and IR activities were deliberated and decided. In addition, the rationality of strategic
shareholding was verified. Furthermore, the status of audit is reported from the Audit & Supervisory Committee in atimely manner.
The deliberations of the Executive Committee and its advisory bodies concerning risk management, compliance,sustainability, and other matters are regularly reported to the Board of Directors. In addition, the Board of Directors
deliberates on important policies, etc.
Aiming to further accelerate the management decision-making process and secure more time for the Board of Directors
to deliberate important matters, the Company reviewed the standards for items to be submitted to and authorized by the
Board of Directors and expanded the scope of matters delegated to the Executive Committee, etc. as of October 1, 2023,
after having multiple discussions with Independent Outside Directors at the Governance Committee.
Attendance at the meetings by Directors and Audit & Supervisory Committee Members in FY2023 was as follows:
15/15 times (100%)ii)

14/15 times (93%)

Takahiro Yanai, Taiju Hisai, Kazumi Anei, Haruhiko Sato, Hiroyasu Nakata, Yuri Sasaki,
Akira Hamamoto, Koichiro Hiraiwa, Hiroko Kaneko
Masayuki Saito

13/15 times (87%)

Takuya Kuga

Governance Committee
The committee meetings were held 6 times in FY2023, and conducted PDCA for effectiveness assessment by deliberating
the manner of effectiveness assessment for the Board of Directors and the analysis of the assessment results. The
committee also reviewed the standards for items to be submitted to the Board of Directors in order to secure more time
for the Board to deliberate important matters. In addition, the committee discussed the establishment of guidelines
regarding the holding of the Company’s shares by Directors so that profits are appropriately shared between Directors,
shareholders, and other stakeholders.
Attendance at the meetings by Directors and Audit & Supervisory Committee Members in FY2023 was as follows:
6/6 times (100%)

Takahiro Yanai, Taiju Hisai, Hiroyasu Nakata, Yuri Sasaki, Takuya Kuga, Akira- 69 -

Hamamoto, Koichiro Hiraiwa, Hiroko Kaneko, Masayuki Saitoiii) Nominating Committee
Committee meetings were held 6 times in FY2023, which deliberated succession plans for the President & CEO and
Representative Director candidates, skills that the Directors should have (skill matrix), etc.
Attendance at the meetings by Directors and Audit & Supervisory Committee Members in FY2023 was as follows:
6/6 times (100%)

Takahiro Yanai, Hiroyasu Nakata, Yuri Sasaki, Takuya Kuga, Koichiro Hiraiwa,
Hiroko Kaneko, Masayuki Saitoiv) Compensation Committee
The committee meetings were held 7 times in FY2023, which deliberated the Directors’ remuneration scheme andstandards, verified the amount paid as performance-based compensation, and deliberated the adoption of a performancebased stock compensation plan.
Attendance at the meetings by Directors and Audit & Supervisory Committee Members in FY2023 was as follows:
7/7 times (100%)
6/7 times (86%)

c.

Taiju Hisai, Hiroyasu Nakata, Yuri Sasaki, Takuya Kuga, Koichiro Hiraiwa, Hiroko
KanekoMasayuki Saito

Development of Risk Management System and Internal Control System
The Company has resolved to use a system for ensuring the propriety of business activities of the company (internal control
system), as follows, in accordance with Article 399-13, paragraph (1), (b) and (c) of the Companies Act, as well as relevantlaws and regulations. Going forward, the Company will continue to make further improvements and enhancements byreviewing it appropriately in accordance with changes in the environment.
Hereinafter, “the Group” refers to “the Company and the Company’s subsidiaries and affiliates,” and “Group companies”
refers to “the Company’s subsidiaries and affiliates.”
In addition, the internal control system shall be applied to each Group company by making appropriate adjustments based on
factors such as the business operations, scale, and importance of each Group company.

- 70 -

System for Group Management(1) The Company shall establish the Mitsubishi HC Capital Group Code of Ethics and Code of Conduct in order to sharefundamental values and ethics to be embraced by all members of the Group and reflect them in business.
(2) The Company shall establish a management method between the Company and the Group companies, in order toensure the propriety of the business activities of the Group companies, and establish internal rules, etc. to improve themanagement efficiency and corporate value of the Group as a whole, through the Group carrying out activities witha strong sense of solidarity.
(3) The Company shall require the Group companies to request prior approval or consultation or to provide reports
regarding important management matters in line with internal rules in order to manage the Group appropriately. Thus,
the Company shall manage the Group companies with responsible departments giving approval, implementing
consultation, receiving reports, etc. in adherence to the allocation of duties.
(4) The Company shall establish management and operational methods for internal controls pertaining to the financial
reports of the Group, and shall effectively develop and operate the internal controls of the Group as a whole, so that
the Company’s financial reports will be prepared appropriately, in accordance with the provisions of the Financial
Instruments and Exchange Act.
System for Compliance with Laws and Regulations(1) The Company shall establish the Mitsubishi HC Capital Group Code of Ethics and Code of Conduct in order to sharefundamental values and ethics to be embraced by all members of the Group and reflect them in business.
(2) The Company shall establish a system for ensuring that the executives and employees of the Group comply with laws
and regulations and the Articles of Incorporation, by establishing and disseminating internal rules, etc. and theCompliance Manual.
(3) The Company shall establish the Compliance Committee, which deals with establishment, maintenance, management,
etc., of the Group’s compliance system, in addition to the Chief Compliance Officer (Head of Risk Management
Division), who is responsible for the compliance of the Group, and the Legal & Compliance Department, which istasked with enforcing compliance.
The Group Companies shall, if there are any legal risks, etc. intrinsic to the business activities of such company,
cooperate with the Company as necessary, and develop an appropriate compliance system.
(4) The Company shall formulate compliance programs (specific plans to ensure that the executives and employees of
the Group comply with laws and regulations, etc., including education for the Group’s executives and employees)
and monitor how the Group’s executives and employees are working on those programs.
(5) The Company shall establish the Compliance Hotline System as an internal whistleblowing system under which theGroup’s executives, employees, etc., can report to or seek consultations with the Company regarding unfair practices
and other conduct. The Company shall not treat persons who have made reports just because they made those reports
using an internal whistleblowing system disadvantageously, and the Company shall specify this in the internal rules,
etc. and fully inform all executives and employees through internal training and on other occasions.
(6) The Group shall take a resolute stance against anti-social forces, which threaten the peace and stability of civil society,and work to prevent transactions with such forces.
(7) The Company shall be aware of the possibility that funds transacted through the Group may be used for various
criminal activities and/or terrorism, and shall work to prevent money laundering.
Information Disclosure System(1) The Group shall establish internal rules, etc. for appropriately disclosing information regarding decisions andoccurrences concerning the Group in a timely manner, in accordance with accounting standards and other relevantlaws and regulations. The Group companies shall cooperate with the Company as necessary.
(2) The Company shall establish a Disclosure Committee which deliberates on the appropriateness of information
disclosure regarding the Group and the effectiveness of internal controls and procedures related to information
disclosure, among other matters.
Internal Audit System(1) The Company shall establish internal rules, etc. to smoothly and effectively promote audit activities by clarifying
procedures for planning, implementing, and reporting internal audits and providing instructions for improvement
within the Group.
(2) The Company shall establish the Internal Audit Department as the department in charge of internal audits. The Internal
Audit Department shall systematically implement internal audits related to the Group based on an annual audit planand report the audit results to the Representative Director, the Board of Directors and Audit & Supervisory Committee.

- 71 -

With regard to findings that require improvement, for which guidance was provided to the departments subject toaudits (important findings), those departments, after taking improvement measures, are made to report the results to
the General Manager of the Internal Audit Department. The results for important findings are to be reported by theInternal Audit Department to the Representative Director, in order to ensure the effectiveness of the audit.
(3) The General Manager of the Internal Audit Department shall regularly and appropriately build collaborative
relationships with the Audit & Supervisory Committee Member(s) of the Company and Auditors and other relevant
persons and the Accounting Auditor of the Group companies, such as by exchanging relevant information with them,and shall work to ensure the efficient implementation of the audit.

- 72 -

Risk Management System
Company-wide Risk Management(1) The Company shall establish a company-wide risk management system that is based on the policy of taking risks
within the controlled scope decided by the Executive Committee, the Board of Directors etc. through overall
understanding of the wide-ranging risks of the Group and sufficient consideration of potential risks estimated alongwith new operations. The company-wide risk management aims to ensure sound management and contribute tosustainable improvement of corporate value, while performing its social responsibility as a company to stakeholders
including clients, shareholders, employees and communities.
(2) The Company shall build a basis for the stable recording of returns that commensurate with risk, for achievement ofan appropriate capital structure, and appropriate allocation of resources, primarily by identifying and recognizing,evaluating and measuring, controlling, monitoring, and reporting the risks of the Group and by implementing
continuous comprehensive risk management.
(3) The Company shall establish individual risk management methods and their implementations, by classifying
significant risks into the following categories based on characteristic features of businesses and services of the Group.
i)
Credit risksii)
Asset risksiii) Investment risksiv) Market risksv)
Liquidity risksvi) Country risksvii) Operational risks(4) The Company shall implement and monitor risk capital management after comprehensively grasping the risks of theGroup that can be evaluated, measured and forecasted in a reasonably quantitative manner and by periodically and asnecessary examining the risk capital management.
(5) The Company shall establish internal rules, etc. that state, among other matters, the Group’s basic policies for risk
management and risk management methods, operations, systems, etc. The Group Companies shall also preparenecessary internal rules, etc. that state, among other matters, the risk management and operations of the Group
Companies.
(6) The Company shall establish an executive officer and a department in charge of companywide risk management
respectively and hold Risk Management Committee meetings related to integrated risk management of the Group as
necessary and on a regular basis. The report to the Risk Management Committee shall be made on major risks of theGroup’s businesses, and other risk-management-related matters concerning financial markets, liquidity, compliance,systems, IT and others provided from the committees and internal auditing.
(7) The Company shall demand significant risk-related reports from the Group Companies and compile them into
information necessary for company-level risk management before reporting current risk, issues, and if necessary
countermeasures, etc. related to the overall management of the Group, to the Board of Directors, which shall supervise
their implementations.
<Crisis Management>(1) The Company shall clarify its basic ideas and judging standards in preparation against an event that may lead to hugeloss, undermine credibility, or cause substantial delay or long-term interruption in business of the Group, and establish
a system, etc. that ensures continuous management of operations in general and recovery of normal functions to fulfill
social responsibility and minimize losses of the Group.
(2) The Company shall, in peacetime, clarify the departments responsible for events in crisis based on the characteristicsof their business, prepare systems that deal with different levels of events in crisis, and establish internal rules, etc.
that enable activities to collect information and collaborate in crisis, and allow business continuity and recovery. The
Group companies shall establish corresponding internal rules, etc. within each company.

- 73 -

Framework for ensuring the efficient Execution of Duties(1) The Company shall set management targets for the Group and draw up management plans to manage business basedon appropriate methods. The Group Companies shall conduct business management based on appropriate methods,
and in accordance with the Group’s management targets and management plans.
(2) The Company shall establish the Executive Committee, a body which will deliberate and decide on important matters,
and the Board of Directors shall delegate the business execution decisions to the Executive Committee in an
appropriate manner. The Executive Committee will hold discussions and make decisions on important matters,
including the business management of the Group, in addition to conducting preliminary deliberations of matters thatare to be submitted to the Board of Directors to facilitate decision-making by the Board of Directors. In addition,
various committees shall be established as advisory bodies for the Executive Committee.
(3) In order to efficiently conduct the execution of duties based on the decisions of the Board of Directors, the Company
shall build an organizational structure, etc., in accordance with the internal rules, etc., and shall assign the executionof duties. The Group companies shall provide appropriate cooperation such as reports to and consultations with theCompany on necessary matters pursuant to the internal rules, etc.
Other Matters related to the execution of Duties by Directors(Framework for ensuring that the execution of duties by Directors complies with laws, regulations, and the Articles ofIncorporation, framework for retention and management of information, and framework for reports to the Company ofmatters related to the execution of duties by subsidiaries’ Directors)(1) The Company shall establish the Executive Committee to deliberate and decide on important management matters.
The Audit & Supervisory Committee Member(s) selected by the Audit & Supervisory Committee shall attend themeeting to confirm the details of the deliberation.
(2) The Company shall clearly define the authority and responsibilities of the Board of Directors and Directors regarding
material decision-making matters including compliance management, as well as matters decided at the discretion of
the Board of Directors.
(3) The Board of Directors shall receive and confirm reports of material information related to the execution of duties by
Executive Directors, and utilize an internal whistleblowing system through reports, etc. of the Compliance Committee.
(4) The Company shall retain and manage material documents and other data related to the execution of duties byDirectors pursuant to the provisions of the internal rules, etc.
(5) The Company shall request prior approval, prior consultation, or reporting of matters related to the execution of duties
by Directors of the Group companies pursuant to the provisions of the internal rules, etc.
Framework concerning Individuals (Employees) who assist with Duties of the Audit & Supervisory Committee(1) The Company shall establish an Audit & Supervisory Committee Office to assist with duties of the Audit &Supervisory Committee.
(2) The Company shall allocate employees to assist with duties of the Audit & Supervisory Committee to the Audit &Supervisory Committee Office.
(3) The above employees shall not be subject to the directions and instructions of Directors excluding Directors who are
Audit & Supervisory Committee Members.
(4) When implementing personnel transfers or disciplinary action for the above employees, prior consent of the Audit &Supervisory Committee shall be obtained. When determining performance evaluation, compensation, etc., related tothose employees, the prior consent of the Audit & Supervisory Committee Member(s) selected by the Audit &Supervisory Committee shall be obtained.
(5) Executive Directors shall cooperate in developing working environments and other relevant conditions so that theabove employees can assist with duties of the Audit & Supervisory Committee smoothly.
Framework for reporting to the Audit & Supervisory Committee(1) Directors, Executive Officers and other relevant executives, and employees must repost the following matters without
delay to the Audit & Supervisory Committee or the Audit & Supervisory Committee Member(s) selected by the Audit& Supervisory Committee:
1. when they discover any facts that are likely to cause significant damage (including loss of credit) to the Company
or when significant damage occurs, they shall immediately report that effect (including matters concerningmaterial lawsuits);
2. the status of whistleblowing through an internal whistleblowing system developed by Directors;
3. the status of management concerning elimination of transactions, and blocking of relationships, with anti-social
forces; and- 74 -

4. other matters that the Audit & Supervisory Committee requests to be reported.
(2) Directors, Auditors, and employees of subsidiaries or persons who receive reports from any of those persons must
report to the Audit & Supervisory Committee or the Audit & Supervisory Committee Member(s) selected by the Audit& Supervisory Committee without delay, if any of the matters set forth in the preceding paragraph occurs.
(3) The Audit & Supervisory Committee Member(s) selected by the Audit & Supervisory Committee shall cooperate
closely with the Auditors of Group Companies and other relevant persons, through means such as exchanging
information necessary for the execution of duties.
(4) If required by the Audit & Supervisory Committee, Directors, Executive Officers and other relevant executives, andemployees must attend the Audit & Supervisory Committee meeting and explain matters with necessary materials. In
addition, they have a similar duty to explain if required by the Audit & Supervisory Committee Member(s) selectedby the Audit & Supervisory Committee.
(5) The Company shall not treat the persons who have made the reports under (1) to the Audit & Supervisory Committee
or any Audit & Supervisory Committee Members disadvantageously, just because they made those reports.
Matters concerning Policies regarding the Expenses or Liabilities arising from the Execution of Duties by the
Audit & Supervisory Committee Members(1) The Audit & Supervisory Committee Office shall promptly process expenses or liabilities when each Audit &Supervisory Committee Member makes requests with respect to the prepayment of expenses and other payments,
except in cases where such requested expenses or liabilities are deemed to be clearly unnecessary for the executionof the duties of an Audit & Supervisory Committee Member.
Other Frameworks for ensuring effective Audits by the Company’s Audit & Supervisory Committee Members(1) The Audit & Supervisory Committee should create an opportunity to interview regularly with Directors, Executive
Officers and other relevant executives, and employees, concerning the business, and conduct a regular meeting to
exchange opinions with the President and the Accounting Auditor.
(2) The Audit & Supervisory Committee may request opinions from lawyers, the Accounting Auditor, etc. as necessary,for cases that require expertise.
(3) The Audit & Supervisory Committee should receive in advance an audit plan from the Accounting Auditor, andregularly receive an audit implementation report; in addition, the Audit & Supervisory Committee should interview
as necessary, regarding the implementation of audit.
(4) The Audit & Supervisory Committee should make efforts to enhance the effectiveness of the audit, by cooperatingwith the Internal Audit Department and conducting an audit, regularly or in a timely manner, of the offices, etc.
including the subsidiary, and by understanding the actual situation.
(5) The employee, who should assist the duties of an Audit & Supervisory Committee Member selected by the Audit &Supervisory Committee and the duties of the Audit & Supervisory Committee, may attend the Executive Committee,
committees and other important meetings and make necessary statements thereat, and view important documents.
(6) An Audit & Supervisory Committee Member selected by the Audit & Supervisory Committee should request that theCompany and its subsidiaries report on its business, or investigate the situation of the duties and properties, and theCompany and its subsidiaries should cooperate therewith.
(7) The personnel of the General Manager of the Internal Audit Department should be decided upon prior consultation
with the Audit & Supervisory Committee Member(s) selected by the Audit & Supervisory Committee.
(8) The Internal Audit Department should report to the Audit & Supervisory Committee regarding the internal audit plan,internal audit result, and the amendment and abolition of the important rules related to internal audit, and should
respond to requests by the Audit & Supervisory Committee in relation to information provision, investigation, andreport.
(9) Directors, Executive Officers and other relevant executives, and employees should provide the necessary cooperation
for the execution of duties of the Audit & Supervisory Committee, based on the Audit & Supervisory Committee
Regulations, standards for audit, etc. of the Audit & Supervisory Committee, and standards for the Audit &Supervisory Committee to conduct an audit regarding an internal control system.

- 75 -

d. Overview of limited Liability Agreements and Directors and Officers Liability Insurance Agreementsi)

Limited Liability Agreements
The Company has entered into limited liability agreements with non-Executive Directors, namely Takahiro Yanai, Yuri
Sasaki, Kayoko Kawamura, Shota Kondo, Yoshitaka Shiba, Hiroyasu Nakata, Hiroko Kaneko, and Masayuki Saito, as
described below.
・ In the event that a non-executive Director is liable to the Company as a result of negligence in their duties, that liability
shall be limited to the minimum liability set forth in Article 425, Paragraph 1 of the Companies Act.
・ The above limitation is recognized only when the non-executive Director performed the duty in question in good faithand without gross negligence.

ii)

Directors and Officers Liability Insurance Agreements
The Company plans to enter into a Directors and officers liability insurance agreement as provided for in Article 430,
Paragraph 3, Item 1 of the Companies Act with an insurance company. The agreement will cover losses incurred fromdamage compensation, legal fees, etc. in cases where an insured receives a claim for damages from a shareholder or third
party. In addition, as a measure to ensure that the lawfulness of the execution of duties of the insured person is notcompromised, the following losses, etc. are excluded from coverage.
1) Damage arising from the fact that the insured illegally obtains private gain or benefit
2) Damage arising from criminal acts of the insured3) Damage arising from the insured’s acts committed with the knowledge that they violate laws or regulations
The insureds under this agreement are the Directors, Directors who are Audit & Supervisory Committee Members, Audit& Supervisory Board Members, and Executive Officers, etc. of the Company and its subsidiaries in Japan. There is no
insurance premium to be paid by the insureds.

(iii) The Contents of the Articles of Incorporation that provide for a fixed Number of Directors or Restrictions on the Qualificationsof Directors, or make Special Provisions which differ from those of the Companies Act with Respect to the Requirements fora Resolution on the Appointment and Dismissal of Directors
The Company’s Articles of Incorporation stipulate the following regarding the fixed number of Directors and the resolution
for their election.
a. Fixed Number of Directors
The Articles of Incorporation stipulate that the Company shall have no more than 22 Directors (of these, no morethan seven Directors are Audit & Supervisory Committee Members).
b. Requirements for Resolution on Election of Directors
The Company’s Articles of Incorporation stipulate that a resolution for the election of Directors shall be adopted
by a majority of the votes of shareholders present at the meeting who hold at least one-third of the voting rights
of shareholders entitled to exercise voting rights.
In addition, the Articles of Incorporation also stipulate that resolution for the election of Directors shall not bemade by cumulative voting.
(iv) Matters and Reasons if it has been decided that the Matters for Resolution of a General Meeting of Shareholders may beresolved by a Board of Directors Meeting; Matters and Reasons if it is stipulated in the Articles of Incorporation that the
Matters for Resolution of a Board of Directors Meeting may not be resolved by a General Meeting of Shareholders; andContents and Reasons if the Requirements for Special Resolution of a General Meeting of Shareholders have been changed
a. Decision-Making Body for Dividends of Surplus, etc.
The Company’s Articles of Incorporation stipulate that, except as otherwise provided for by laws and regulations, thematters including dividends of surplus set forth in each item of Article 459, Paragraph 1 of the Companies Act shall be
determined by resolution of the Board of Directors without a resolution of the General Meeting of Shareholders. This is forthe purpose of flexibly returning profits to shareholders by making dividends of surplus, etc. with the authority of the Boardof Directors.

- 76 -

b. Decision-Making Body for Acquisition of Treasury Shares
The Company’s Articles of Incorporation stipulate that, in accordance with Article 165, Paragraph 2 of the Companies Act,
the Company may acquire its treasury shares through market transactions or other means by resolution of the Board of
Directors in order to implement capital policies quickly.
c. Exemption of Directors, etc. from Liability
In accordance with Article 426, Paragraph 1 of the Companies Act, the Company’s Articles of Incorporation stipulate that
the Company may, by resolution of the Board of Directors, exempt Directors (including a person who was a Director) fromliability for damages under Article 423, Paragraph 1 of the Act, to the extent of the minimum liability amount stipulated bylaws and regulations, in order to develop an environment in which Directors can fully exercise their abilities and performtheir expected roles.
In addition, as a transitional measure in connection with the management integration of the Company and Hitachi Capital
Corporation, the Company’s Supplementary Provisions of its Articles of Incorporation stipulate that the Company may,pursuant to the provisions of Article 426, Paragraph 1 of the Companies Act, exempt executive officers (including persons
who were executive officers) of the absorbed company in an absorption-type merger with the Company as the surviving
company and Hitachi Capital Corporation as the absorbed company, from liability for damages prior to the taking effect ofthe merger under Article 423, Paragraph 1 of the Companies Act, by a resolution of the Board of Directors, to the extent
permitted by laws and regulations.
d. Requirements for Special Resolution of Shareholders’ Meeting
The Company’s Articles of Incorporation stipulate that the adoption of a special resolution of a shareholders’ meeting,provided for in Article 309, Paragraph 2 of the Companies Act, shall require at least two-thirds of the votes of shareholders
present at the meeting who hold at least one-third of the voting rights of shareholders entitled to exercise voting rights. The
purpose of this is to ensure smooth management of the General Meeting of Shareholders by relaxing the quorum for special
resolutions at the General Meeting of Shareholders.

- 77 -

(2) Directors of the Company(i) Directors and Executive Officers
Male: 9, Female: 3 (Ratio of female officers: 25.0%)
Title

Name

Date of Birth

Career Summary
April 1982
May 2012

Director,
Chairman

Takahiro Yanai

May 4, 1958

June 2015

May 2016
June 2017

April 2021
April 2023

Term

Joined The Mitsubishi Bank, Ltd. (currently
MUFG Bank, Ltd.)Managing Executive Officer of The Bank ofTokyo-Mitsubishi UFJ, Ltd. (BTMU)In charge of CIB (Corporate Investment Banking)and Secondarily in charge of Market Sales
Division of BTMUManaging Officer, Deputy Group Head, Integrated
Trust Assets Business Group, Deputy Group Head,
Integrated Corporate Banking Business Group, andHead of the Corporate & Investment Banking
Planning Division of Mitsubishi UFJ Financial
Group, Inc. (MUFG)
Managing Director, Chief Executive, Retail(Note)4
Banking Business Unit of BTMUManaging Executive Officer, Group Head,
Integrated Retail Banking Business Group of
MUFG
Senior Managing Executive Officer, Group Head,
Transaction Banking Group of BTMU
President & CEO of Mitsubishi UFJ Lease &Finance Company Limited (MUL) (currently theCompany)
Concurrently served as Executive Officer of MULRepresentative Director, President & CEO of theCompany
Director, Chairman of the Company (incumbent)- 78 -

Number ofshares held
(Shares)

24,400TitleName

Date of Birth

Career Summary

Term

April 1985

Representative
Director,
President & CEO

Taiju Hisai

April 27, 1962

Joined The Mitsubishi Bank, Ltd. (currently
MUFG Bank, Ltd.)
July 2011
General Manager, Corporate Investment Banking
Division for the Americas, Headquarters for theAmericas of The Bank of Tokyo-Mitsubishi UFJ,
Ltd. (BTMU) (currently MUFG Bank, Ltd.)
Concurrently served as President of BTMU
Leasing & Finance, Inc.
July 2012
General Manager, Corporate Banking Division for
Europe, Middle East and Africa, Headquarters for
Europe, Middle East and Africa of BTMU
Concurrently assigned to BTMU (Europe) Limited
June 2014
Executive Officer and General Manager, Corporate
Banking Division for Europe, Middle East andAfrica, Headquarters for Europe, Middle East andAfrica of BTMU
Concurrently assigned to BTMU (Europe) Limited
September 2014 Executive Officer, Regional Executive for India
Concurrently served as Deputy General Manager,
Corporate Banking Division for Asia and Oceania, (Note)4
Headquarters for Asia and Oceania of BTMUMay 2016
Managing Executive Officer, in charge of Credit of
BTMU
April 2018
Managing Executive Officer and Group Head,
Corporate Banking Group No. 1 of MUFG Bank,
Ltd. (MUFG Bank)
April 2019
Senior Managing Executive Officer and Group
Head, Corporate Banking Group No. 1 of MUFG
Bank
June 2021
Deputy President of the Company
Concurrently served as Executive Officer of theCompany
June 2022
Director, Deputy President of the Company
Concurrently served as Executive Officer of theCompany
April 2023
Representative Director, President & CEO of theCompany (incumbent)
Concurrently serves as Executive Officer of theCompany (incumbent)

Number ofshares held
(Shares)- 79 -

5,300

TitleName

Date of Birth

Career Summary
April 1986
May 2013

October 2013

March 2014
April 2014

April 2017

Representative
Director,
Deputy President

Aiichiro
Matsunaga

March 14, 1963
April 2018

April 2019
April 2022

July 2022
April 2024

June 2024

Joined Mitsubishi Corporation
General Manager, Power Systems International
Dept., New Energy & Power Generation Div. of
Mitsubishi Corporation
General Manager, Power Systems International
Dept., New Energy & Power Generation Div. of
Mitsubishi Corporation(Concurrently) Executive Vice President of
Mitsubishi Corporation Machinery, Inc.
Global Environmental & Infrastructure BusinessGroup CEO Office of Mitsubishi Corporation
President, Mitsubishi Corporation do Brasil, S.A.,
Sao Paulo (Concurrently) Deputy Regional CEO,
Latin America and the Caribbean(Concurrently) General Manager, Asuncion
Liaison OfficeSenior Vice President (Riji) of Mitsubishi
Corporation
Regional CEO, Latin America and the Caribbean,
Sao Paulo, Brasil(Concurrently) President, Mitsubishi Corporation
do Brasil, S.A.
(Concurrently) General Manager, Asuncion
Liaison OfficeSenior Vice President (Shikko-Yakuin) of
Mitsubishi Corporation
Regional CEO, Latin America and the Caribbean,
Sao Paulo, Brasil(Concurrently) President, Mitsubishi Corporation
do Brasil, S.A.
(Concurrently) General Manager, Asuncion
Liaison Office
Executive Vice President, Group CEO, Industrial
Infrastructure Group of Mitsubishi Corporation
Executive Vice President, Group CEO, Power
Solution Group, and Power & Retail DX Task
Force Leader of Mitsubishi Corporation
Executive Vice President, Group CEO, Power
Solution Group of Mitsubishi Corporation
Deputy President of the Company
Concurrently served as Executive Officer of theCompany
Representative Director, Deputy President of theCompany (incumbent)
Concurrently serves as Executive Officer of theCompany (incumbent)- 80 -

Term(Note)4

Number ofshares held
(Shares)0TitleName

Date of Birth

Career Summary
April 1985
April 2003

April 2005
April 2010
April 2011
October 2011
April 2014

April 2015

April 2016

Director,
Deputy President

Kazumi Anei

September 18, 1960
April 2017

April 2018

April 2019

April 2020

April 2021
May 2021

Director,
Managing Executive
Officer

Haruhiko Sato

June 19, 1965

Term

Joined Hitachi Leasing Corp. (currently theCompany)
General Manager of Sales Dept. II, Kansai
Corporate Sales Branch, Kansai Sales Division of
Hitachi Capital Corporation (Hitachi Capital)
Head of Kansai Corporate Sales Branch, Kansai
Sales Division of Hitachi Capital
Head of Kanagawa Sales Division of Hitachi
CapitalHead of Tokyo Sales Division III, Corporate
Business Division of Hitachi Capital
Co-Head of Corporate Business Division of
Hitachi Capital
Corporate Officer, Head of Corporate Business
Division, and Co-Head of Account Sales
Promotion Division of Hitachi Capital
Corporate Officer and Head of Corporate Business
Division, Corporate Sales & Marketing Group of
Hitachi Capital
Executive Officer, Head of Corporate Business
Division, Corporate Sales & Marketing Group, andHead of Service Business Division of Hitachi
Capital(Note)4
Executive Officer, Corporate Sales & MarketingGroup, in charge of Japan, and Head of Customer
E&E Business Division of Hitachi Capital
Vice President and Executive Officer, Co-Head ofCorporate Sales & Marketing Group, in charge ofJapan, and Head of Environment and Energy
Business, Corporate Business Division, Customer
E&E Business Division of Hitachi Capital
Vice President and Executive Officer, Co-Head ofCorporate Sales & Marketing Group, and Chief
Executive for Japan, Corporate Sales & MarketingGroup of Hitachi Capital
Senior Vice President and Executive Officer, Chief
Marketing Officer, and Head of Business
Enhancement Division (in charge of Europe andthe Americas) of Hitachi Capital
Director, Senior Managing Executive Officer of
the Company
Director, Deputy President of the Company(incumbent)
Concurrently serves as Executive Officer of theCompany (incumbent)

April 1989
Joined Mitsubishi Corporation
November 2002 Mitsubishi International GmbH (based in
Dusseldorf)
January 2007 Finance Director, Moscow Office of Mitsubishi
Corporation
April 2009
Treasurer Office of Mitsubishi Corporation
April 2011
Deputy General Manager, Structured Finance,
M&A Advisory Dept. of Mitsubishi Corporation
March 2014
Senior Vice President, Corporate Staff Section and
CFO of Mitsubishi Corporation (Americas)
April 2019
General Manager, Power Solution Administration
Department of Mitsubishi Corporation
April 2021
Director, Managing Executive Officer of theCompany (incumbent)
Concurrently serves as Executive Officer of theCompany (incumbent)- 81 -(Note)4

Number ofshares held
(Shares)

56,5000TitleName

Date of Birth

Career Summary

Term

April 1995

Director(Independent Outside
Director)

Yuri Sasaki

May 26, 1967

Assistant at Hitotsubashi University (Faculty ofCommerce and Management)
April 1998
Assistant Professor of Faculty of Commerce,
Takachiho University of Commerce (current
Takachiho University)
April 2001
Assistant Professor of Faculty of Economics, Meiji
Gakuin University
April 2006
Visiting Scholar at University of Washington
April 2007
Professor of Faculty of Economics, Meiji Gakuin
University (incumbent)
June 2014
Director of JBA TIBOR Administration(Note)4
January 2015 Expert Committee Member of Financial System
Council, Financial Services Agency (incumbent)
November 2015 Visiting Scholar at University of Washington
June 2018
Director of Hitachi Capital Corporation (currently
the Company)
April 2020
Dean of Faculty of Economics, Meiji Gakuin
University
April 2021
Director of the Company (incumbent)
July 2022
Director of Meiji Yasuda Life Insurance Company(incumbent)

Number ofshares held
(Shares)

April 1987
August 1999
January 2006
April 2008
July 2009

March 2010

Director(Independent Outside Kayoko Kawamura
Director)

July 12, 1964

January 2012
March 2012

July 2016
January 2019
April 2021
July 2021

June 2024

Joined IBM Japan, Ltd.
Executive Assistant to the GM of Global Services,
IBM Asia Pacific and Japan
Manager, Global Delivery Solution of IBM Japan,
Ltd.
Director, Head of Open System Development of
IBM Japan, Ltd.
Director, Head of Financial Service Delivery
Application Management Service Delivery of IBM
Japan, Ltd.
Director (non-executive), Regional Bank Solution
and Services Co., Ltd. (until March 2015)
Director (non-executive), IBM Global Services
Japan Collaboration Solutions and Services
Company (until March 2015)
Director, Head of Application Management(Note)4
Service Delivery of IBM Japan, Ltd.
Director (non-executive), D&I Information
Systems Inc. (until March 2015)
Director (non-executive), MLI Systems Inc. (until
March 2015)
Director, Head of Sales, Technology Support
Service of IBM Japan, Ltd.
Director, Head of Business Consulting of Teradata
Japan, Ltd.
Director, Head of Business Consulting, Executive
Officer of Teradata Japan, Ltd.
Senior Director, Customer Support Services,
Executive Officer of Teradata Japan, Ltd.
(incumbent)
Director of the Company (incumbent)- 82 -

1,300

0TitleName

Date of Birth

Career Summary
April 1991
May 2013
April 2016

April 2017

April 2019

Director(Outside Director)

Shota Kondo

September 27, 1967

April 2020
April 2021
April 2022

April 2024

May 2024
June 2024
June 2024
April 1986
May 2009

May 2011
June 2012
May 2014
Director(Audit & Supervisory
Yoshitaka Shiba
Committee Member)(Full-time)May 2016
July 25, 1961
July 2018

April 2020

April 2024
May 2024
June 2024

Term

Number ofshares held
(Shares)

Joined Mitsubishi Corporation
General Manager, Russia Business Dept., Natural
Gas Business Div. of Mitsubishi Corporation
General Manager, Shale Gas Business Dept.,
Natural Gas Business Div. of Mitsubishi
Corporation
General Manager, Canada Oil & Gas Business
Dept., Energy Resources Div. B of Mitsubishi
Corporation
General Manager, Houston Branch of Mitsubishi
Corporation (Americas)(Concurrently) General Manager, Houston Branchof Mitsubishi International Corporation(Note)4
General Manager, Natural Gas Group CEO Officeof Mitsubishi Corporation
Senior Vice President, General Manager, Natural
Gas Group CEO Office of Mitsubishi Corporation
Senior Vice President, General Manager, Corporate
Strategy & Planning Dept. of Mitsubishi
Corporation
Executive Vice President, Group CEO, Smart-Life
Creation Group of Mitsubishi Corporation(incumbent)
Director of Lawson, Inc. (incumbent)
Director of OK Corporation (incumbent)
Director of the Company (incumbent)0Joined The Tokai Bank, Ltd. (currently MUFG
Bank, Ltd.)
General Manager, Kibafukagawa Commercial
Banking Office of The Bank of Tokyo-Mitsubishi
UFJ, Ltd. (BTMU)
Deputy General Manager, Human Resources
Division (Nagoya) of BTMU
Executive Officer and General Manager, Credit
Division of The Bank of BTMU
Executive Officer and General Manager, Internal
Audit & Credit Examination Division of BTMUManaging Executive Officer, in charge ofcorporate banking offices and branches in Central(Note)5
Region of Japan of BTMUManaging Executive Officer, Regional Head,
Commercial Banking Offices and Branches inCentral Region of Japan of MUFG Bank, Ltd.
Senior Managing Corporate Executive, Group
CAO, and Managing Director, Head of Internal
Audit Division of Mitsubishi UFJ Financial Group,
Inc.
Managing Executive Officer of Mitsubishi UFJ
Financial Group, Inc.
Advisor of the Company
Director (Audit & Supervisory Committee
Member) of the Company (incumbent)0- 83 -

TitleName

Date of Birth

Career Summary
April 1977

2,700

Joined The Sapporo Television Broadcasting Co.,
Ltd.
October 1989 Joined Ota Showa Audit Corporation (currently
ERNST & YOUNG SHINNIHON LLC)
February 1993 Registered as certified public accountant
May 2007Partner, ERNST & YOUNG SHINNIHON(currently ERNST & YOUNG SHINNIHON LLC)
July 2010
Senior Partner, ERNST & YOUNG SHINNIHON
LLC
April 2018
Professor at Waseda Graduate School of
Accountancy
June 2018
Audit & Supervisory Board Member, The Shoko
Chukin Bank, Ltd.
June 2019
Director of Kanagawa Chuo Kotsu Co., Ltd.
June 2020
Audit & Supervisory Board Member of Mitsubishi (Note)5
UFJ Lease & Finance Company Limited (currently
the Company)
February 2021 Member of Business Accounting Council,
Financial Services Agency (incumbent)
April 2021
Director (Audit & Supervisory Committee
Member) of the Company (incumbent)
March 2022
Member of the Board, The Yokohama Rubber Co.,Ltd.
June 2022
Director (Audit & Supervisory Committee
Member), Kanagawa Chuo Kotsu Co., Ltd.
June 2023
Audit & Supervisory Board Member ofDevelopment Bank of Japan Inc. (incumbent)
June 2023
Audit & Supervisory Board Member of Shin-Etsu
Chemical Co., Ltd. (incumbent)

2,700

June 1993
April 1995
April 1999
August 29, 1951

Number ofshares held
(Shares)Completed the legal apprentice course at the Legal
Training and Research Institute of the Supreme
Court of Japan
Admitted to the bar (Daini Tokyo Bar Association)(until March 1990)
Associate Professor at Faculty of Law andEconomics, Chiba University
Professor at Faculty of Law and Economics, Chiba
University
Professor at Faculty of Law, Hitotsubashi
University
Professor of Graduate School of Law, Hitotsubashi
University(Note)5
Trustee of Hitotsubashi University
Professor at The University of Tokyo Graduate
Schools for Law and Politics and The University ofTokyo Faculty of Law
Emeritus Professor of Hitotsubashi University
Professor at Waseda Law School
Emeritus Professor of The University of Tokyo
Audit & Supervisory Board Member of Mitsubishi
UFJ Lease & Finance Company Limited (currently
the Company)
Director of the Company
Director (Audit & Supervisory Committee
Member) of the Company (incumbent)

April 1990

Director(Audit & Supervisory
Committee Member) Hiroyasu Nakata(Independent Outside
Director)

Term

April 2003
April 2008

April 2015
April 2017
June 2017
June 2018

April 2021
June 2024
April 1980

Director(Audit & Supervisory
Committee Member)(Independent Outside
Director)

Hiroko Kaneko

March 28, 1958

- 84 -

TitleName

Date of Birth

Career Summary
April 1977
April 2008
June 2010
April 2011
April 2012

April 2013

Director(Audit & Supervisory
Committee Member)(Independent Outside
Director)

Masayuki Saito

November 8, 1954
January 2016

January 2020

January 2021

June 2022
March 2024

Term

Joined Dainippon Ink and Chemicals, Incorporated(currently DIC Corporation)
Executive Officer and Head of Finance andAccounting Unit of DIC Corporation
Director and Executive Officer, Head of Financeand Accounting Unit of DIC Corporation
Director and Managing Executive Officer, Head ofFinance and Accounting Unit of DIC Corporation
Representative Director, Senior Managing
Executive Officer, Assistant to the President andCEO, and Head of Finance and Accounting Unit of
DIC Corporation
Representative Director, Senior Managing
Executive Officer, Assistant to President and CEO,and in Charge of Finance & Accounting Div. of
DIC Corporation
Chairman of the Supervisory Board, Sun ChemicalGroup Coöperatief U.A.
(Note)5
Representative Director, Executive Vice President,
CFO, and Assistant to President and CEO of DIC
Corporation
Chairman of the Supervisory Board, Sun ChemicalGroup Coöperatief U.A.
Representative Director, Executive Vice President,
and Assistant to President and CEO of DIC
Corporation
Chairman of the Supervisory Board, Sun ChemicalGroup Coöperatief U.A.
Chairman of the Board of Directors of DIC
Corporation
Chairman of the Supervisory Board, Sun ChemicalGroup Coöperatief U.A.
Director, Audit & Supervisory Committee Memberof the Company (incumbent)
Advisor of DIC Corporation (incumbent)

Total

Number ofshares held
(Shares)

2,700

95,600(Notes) 1. Directors who are not Audit & Supervisory Committee Members, Ms. Yuri Sasaki, Ms. Kayoko Kawamura and Mr.
Shota Kondo are Outside Directors.
2. Directors who are Audit & Supervisory Committee Members, Mr. Hiroyasu Nakata, Ms. Hiroko Kaneko and Mr.
Masayuki Saito are Outside Directors.
3. The Company has introduced an executive officer system, and has 26 Executive Officers (four of whom concurrently
serve as Directors).
4. From the close of the Annual General Meeting of Shareholders held on June 25, 2024 to the close of the Annual
General Meeting of Shareholders for the fiscal year ending March 31, 2025.
5. From the close of the Annual General Meeting of Shareholders held on June 25, 2024 to the close of the Annual
General Meeting of Shareholders for the fiscal year ending March 31, 2026.

- 85 -

(ii) Status of Outside Officers
The Company has six Outside Directors, including five independent Outside Directors.
The Board of Directors is responsible for the appropriate decision-making of the Board of Directors and the oversight ofoverall management from an external perspective. The Board of Directors appoints a number of Outside Directors andstrives to establish an efficient and effective corporate governance system to further enhance it.
At present, the Company’s Board of Directors is composed of Directors from a variety of professions and industries, andthe Company believes that it has the right number and diversity.
The personnel relationship, capital relationship or business relationship between the Outside Directors and the Company,
other interests, and the reasons for the election of the Outside Directors are as follows.
Title

Outside Director

Outside Director

Name

Relationship with the Company

Reasons for Appointment and expected Role

Not applicable・Based on her academic knowledge as a university
professor and excellent insights and abundant
experience as a researcher of international finance,
she has contributed to the appropriate decisionmaking of the Board of Directors and supervision of
overall management as an Independent Outside
Director, and has therefore been reappointed as a
Director.
・The Company expects that she will contribute to theappropriate decision-making of the Board of
Directors and the supervision of overall management
as an Independent Outside Director, and contribute toimproving the soundness, transparency and fairnessof management as a member of the GovernanceCommittee, the Nomination Committee and theCompensation Committee, based on the above
knowledge and experience and from an objective
perspective independent from the management teamthat executes business.

Ms. Kayoko Kawamura previously served as a Directorof IBM Japan Ltd., but the transaction amount between
IBM Japan Ltd. and MHC in FY2023 was less than 1%of the consolidated net sales of either company.

・Ms. Kayoko Kawamura has a wealth of experienceand knowledge in DX, having previously served as asystems engineer and head of application
development for financial institutions among otherpositions at IBM Japan Ltd., and is currently
primarily responsible for supporting digitaltransformation (DX) for client companies, at Teradata
Japan, Ltd. In addition, since she has experience inthe management of corporate organizations as a parttime officer, the Company expects her to contributeto the appropriate decision-making of the Board of
Directors and supervision of overall management as
an Independent Outside Director, and is therefore
appointing her as a new Director.
・The Company expects her to use her knowledge toadvise us on the promotion of DX, one of ourimportant measures, to contribute to the appropriate
decision-making of the Board of Directors andsupervision of overall management as an Independent
Outside Director from an objective perspective
independent of executive management responsible
for executing business and to contribute to theimprovement of the soundness, transparency, andfairness of the management of the Company as amember of the Governance Committee, theNomination Committee and the Compensation
Committee, based on the above knowledge.

Yuri Sasaki

Kayoko Kawamura- 86 -

TitleOutside Director

Name

Relationship with the Company

Reasons for Appointment and expected Role

Mr. Shota Kondo is currently Executive Vice Presidentof Mitsubishi Corporation, a major shareholder of theCompany, and there are business relationships such aslease agreements between Mitsubishi Corporation and
the Company.

・Mr. Shota Kondo has a wealth of management
experience at a major Japanese general trading
company, as well as deep knowledge in Japanese andinternational businesses. The Company expects him
to use his experience and knowledge from a practicalperspective to contribute to the appropriate decisionmaking and supervision of overall management by
the Board of Directors as an Outside Director, and istherefore appointing him as a new Director.
・As Mr. Kondo concurrently serves as the Executive
Vice President of Mitsubishi Corporation, a major
shareholder of the Company, he is not designated asan Independent Director. Mitsubishi Corporation is
an important business partner for the Company towork together with to aim for the improvement ofcorporate value.
・Among other positions, including overseas
assignments in the U.S., he had served as General
Manager, Natural Gas Group CEO Office andGeneral Manager, Corporate Strategy & Planning
Dept. Currently he assumes a position of the Group
CEO, Smart-Life Creation Group. The Company
expects to utilize Mr. Kondo’s management
experience and extensive knowledge in overall
Japanese and international businesses for theCompany’s management and effectively utilize
advice from him, who has served as a chief ofbusiness areas of collaboration between Mitsubishi
Corporation and the Company. The Company deems
that this will lead to the improvement of theCompany’s corporate value and contribute to theenhancement of the interests of all shareholders
including minority shareholders.
・Mr. Kondo has indicated his intention to perform his
duties as a Director for the benefit of the Company,
and not for any specific shareholder. If any item ofbusiness posing a conflict of interest between
Mitsubishi Corporation and the Company issubmitted to the Company’s Board of Directors, hewill participate in neither the resolutions nor the
deliberations.
・The Company expects that he will contribute to theappropriate decision-making of the Board of
Directors and the supervision of overall management
as an Outside Director, and contribute to improving
the soundness, transparency and fairness ofmanagement as a member of the GovernanceCommittee, the Nomination Committee and theCompensation Committee, based on the above
knowledge.

Shota Kondo- 87 -

TitleName

Relationship with the Company
Not applicable・Mr. Hiroyasu Nakata has previously contributed tothe appropriate decision-making and supervision of
overall management by the Board of Directors as a
Director who is not Audit & Supervisory Committee
Member.
・The Company expects him to use deep knowledge asa legal expert to contribute to the appropriate
decision-making of the Board of Directors andsupervision of overall management as an Independent
Outside Director, as well as to neutral and objective
audits, and is therefore appointing him as a new
Director (Audit & Supervisory Committee Member).
・The Company expects that he will contribute toensuring its sound management as an Independent
Outside Director, and contribute to improving thesoundness, transparency and fairness of management
as a member of the Governance Committee, theNomination Committee and the Compensation
Committee, based on the above knowledge and froman objective perspective independent from the
management team that executes business.

Not applicable・Based on her extensive experience at major audit
firms and as a university professor as well as her indepth knowledge as an accounting expert, she has
contributed to the Board of Directors’ appropriate
decision-making
andoverallmanagement
supervision as an Independent Outside Director, andto neutral and objective audits, and has therefore beenreappointed as a Director (Audit & Supervisory
Committee Member).
・The Company expects that she will contribute toensuring its sound management as an Independent
Outside Director, and contribute to improving thesoundness, transparency and fairness of management
as a member of the Governance Committee, theNomination Committee and the Compensation
Committee, based on the above knowledge and froman objective perspective independent from the
management team that executes business.

Mr. Masayuki Saito previously served as Representative
Director and Executive Vice President of DIC
Corporation, but the transaction amount between DIC
Corporation and MHC in FY2023 was less than 1% of
the consolidated net sales of either company.

・Mr. Masayuki Saito has a wealth of management
experience at a major Japanese manufacturing
company, as well as deep knowledge in finance andaccounting. The Company expects him to contributeto the appropriate decision-making of the Board of
Directors and supervision of overall management as
an Independent Outside Director, and to neutral andobjective audits, and has therefore been reappointed
as a Director (Audit & Supervisory Committee
Member).
・The Company expects that he will contribute toensuring its sound management as an Independent
Outside Director, and contribute to improving thesoundness, transparency and fairness of management
as a member of the Governance Committee, theNomination Committee and the Compensation
Committee, based on the above knowledge and froman objective perspective independent from the
management team that executes business.

Outside Director(Audit & Supervisory Hiroyasu Nakata
Committee Member)

Outside Director(Audit & Supervisory
Committee Member)

Outside Director(Audit & Supervisory
Committee Member)

Reasons for Appointment and expected Role

Hiroko Kaneko

Masayuki Saito(Note) The Company has designated Directors Yuri Sasaki and Kayoko Kawamura, and Directors Hiroyasu Nakata, Hiroko Kaneko,
and Masayuki Saito, who are members of the Audit & Supervisory Committee, as independent Directors, and has registeredthem as such with the Tokyo Stock Exchange.

- 88 -

Independence Standards for Outside Directors
The Company shall judge the independence through confirmation as to whether the candidate at any time in the past three
years has fallen under any of the following (1) through (6), on condition that the individual fulfills the requirements forindependent directors set forth by the financial instruments exchanges of Japan, such as the Tokyo Stock Exchange, andthen through multifaceted examination as to whether the individual can be evaluated as having independence objectively
and substantially:(1)

A major shareholder of the Company (a person who holds 10% or more of the total voting rights) or an executive
thereof (*1)

(2)
(3)

An executive of a lender (*2) that exceeds the standards set by the Company
An executive of a business partner (*3) that exceeds the standards set by the Company(4)

A person who provides professional services, such as a consultant, lawyer, or certified public accountant, receiving
monetary or other property benefits exceeding 10 million yen per business year in addition to remuneration for

(5)
(6)

officers from the Company
Representative partner or employee of the Company’s Accounting Auditor
A person who belongs to an organization that has received a donation exceeding a certain amount (*4) from theCompany(*1) Executive means executive directors, executive officers and other employees, etc.
(*2) Lenders exceeding the standards set by the Company are those with the Company’s borrowings exceeding 2%of the consolidated total assets.
(*3) A business partner that exceeds the standards set by the Company is a business partner with which transactions
with the Company exceed 2% of the consolidated net sales of the Company.
(*4) A donation exceeding a certain amount means a donation exceeding 10 million yen per business year.
Even if the candidate falls under any of the above (1) through (6), if there are special circumstances for designating thecandidate as an independent director and the Company judges that he/she substantially has independence and therefore
will register him/her as an independent director with the financial instruments exchanges of Japan, such as the Tokyo
Stock Exchange, the reason therefor shall be explained and disclosed in the Reference Materials Concerning the General
Meeting of Shareholders relating to such notification and the election proposal.

(iii) Supervision or Audits by Outside Directors (collaboration with internal audit, with the Audit & Supervisory Committee,
with accounting audit, and relationship with internal control departments)
At the Board of Directors’ meetings, Outside Directors receive internal audit plans and audit implementation reports fromthe Internal Audit Department, activity reports from the Audit & Supervisory Committee, and financial results, the status ofbusiness execution and reports on operation of the Risk Management Committee, the Compliance Committee, etc. frominternal control departments.
Of Outside Directors, Directors who are Audit & Supervisory Committee Members regularly receive reports on theimplementation status of individual audits from the Internal Audit Department, and reports on audit and review results fromthe Accounting Auditor, and express their opinions where appropriate to strengthen mutual collaboration.
The status of the Audit & Supervisory Committee’s activities is as described in “(3) Status of the Audit” in “4. Corporate
Governance, etc.” of “Item 4. Information on the Company.”- 89 -

(3) Status of the Audit(i) Status of the Audit of the Audit & Supervisory Committeea. Organization, Personnel and Procedures
The Company is a company with an audit & supervisory committee, which consists of one full-time Audit & Supervisory
Committee Member and three part-time Audit & Supervisory Committee Members (outside) at the time of submission ofthis report.
In addition to having been involved in management at one of Japan’s major financial institutions, Mr. Yoshitaka Shiba has
also accumulated experience and knowledge as the Group CAO and Head of the Internal Audit Department.
Mr. Hiroyasu Nakata has deep knowledge as a legal expert.
Ms. Hiroko Kaneko has extensive experience at major audit firms and as a university professor, as well as in-depth
knowledge as an accounting expert.
Mr. Masayuki Saito has a wealth of management experience at a major Japanese manufacturing company, as well as deep
knowledge in finance and accounting.
Each Audit & Supervisory Committee Member of the Company has a high level of insight into the financial business, andthe Company also has established a system to ensure the full effectiveness of accounting audits.
Mr. Yoshitaka Shiba serves as Chairman of the Audit & Supervisory Committee. In addition, the Company has establishedthe Audit & Supervisory Committee Office, which assists in activities of the Audit & Supervisory Committee. Employeeswith appropriate knowledge, ability and experience have been assigned to the Office.
b. Status of Audit Activities of the Audit & Supervisory Committee
A. Number of Audit & Supervisory Committee Meetings held and Attendance of each Audit & Supervisory Committee
Member
The Audit & Supervisory Committee meetings are held every month, in principle. Audit & Supervisory Committee
meetings were held 15 times during fiscal 2023, and attendance of Audit & Supervisory Committee Members is asfollows.
15/15 times (100%): Akira Hamamoto, Koichiro Hiraiwa, Hiroko Kaneko, and Masayuki Saito
B. Specific Matters for Consideration, etc. by the Audit & Supervisory Committee
With the basic policy of implementing audits that contribute to the establishment of a quality corporate governancestructure, the Audit & Supervisory Committee closely cooperates with the Internal Audit Department, internal control
departments and the Accounting Auditor to conduct effective audits.
Main matters deliberated and reported by the Audit & Supervisory Committee
・Audit policies and audit plans
・Fees for the Accounting Auditor, the reappointment of the Accounting Auditor and the appropriateness of audit
results
・Preparation of audit reports
・Important agenda proposed to the meetings of the Board of Directors
・Results of operational audits and internal control audits by the Internal Audit Department
・The status of internal controls managed by internal control departments
・Progress and results of the audit by the Accounting Auditor, process for determining Key Audit Matters (KAM),
etc.
・Matters reported and discussed by committees (risk management, compliance, sustainability, IT, information
disclosure, ALM, etc.)
C. Status of Audit Activities of the Audit & Supervisory Committee
Through the following activities, the Audit & Supervisory Committee works to conduct objective and effective audits
from an independent position.
Major Audit & Supervisory Committee Activities
・Deliberations, etc. among the Audit & Supervisory Committee-

Formulation of audit policies, audit plans, and priority audit items for the year
Reporting on business execution by business execution divisions-

Matters related to business reporting, financial results documents, etc.
Reporting on the Accounting Auditor’s audit plans, the status of audits, and audit results-

Reporting on the Internal Audit Department’s audit plans, the status of audits, and audit results

・On-site observations of offices in Japan and overseas
On-site observations of offices of MHC and its Group companies in Japan and overseas- 90 -

・Meetings with the management team- Regular opinion exchanges with Representative Directors, Business Division Heads, and Corporate Center
Division Heads- Opinion exchanges with Group companies’ management members
The major activities of full-time Audit & Supervisory Committee Members are as follows. The results of these
activities are reported to the Audit & Supervisory Committee, or appropriately shared with part-time Audit &Supervisory Committee Members, increasing the effectiveness of the Audit & Supervisory Committee’s activities.
Main Activities of Full-time Audit & Supervisory Committee Members
・Attendance at meetings-

Attendance at Executive Committee meetings and other committee meetings held by business execution
divisions, information collection, etc.

・On-site audits and observations of offices in Japan and overseas- On-site audits and observations of offices of MHC and its Group companies in Japan and overseas, informationcollection, etc.
・Inspection of documents
Inspection of important documents, examination of content
・Meetings with the management team-Regular and ad-hoc meetings with Representative Directors, etc.
・Discussions with internal control divisions-

Regular and ad-hoc meetings with accounting departments, risk management departments, and legal andcompliance departments

・Discussions with Group company auditors, etc.
Regular and ad-hoc meetings with auditors, etc. at domestic and overseas Group companies
・Discussions with the Accounting Auditor
Regular and ad-hoc meetings with the Accounting Auditor
Full-time Audit & Supervisory Committee Members collect wide-ranging information by attending major meetings,
confirming important documents, and collaborating with the Internal Audit Department and internal control
departments. They report on important matters to external Audit & Supervisory Committee members in order todeepen their understanding, and for particularly important matters, they issue instructions for additional reporting torelated parties to include such matters in agenda items for the Audit & Supervisory Committee.
Organically combining the resolute independence of external Audit & Supervisory Committee members with theinformation gathering capabilities of internal Audit & Supervisory Committee members serves to enhance theeffectiveness of the Audit & Supervisory Committee’s activities. They communicate what they have noticed in theseaudit activities to business execution divisions, and they provide advice as needed.
Audit & Supervisory Committee Members and Outside Directors who are not members of the Audit & Supervisory
Committee are able to collaborate as necessary through exchanging information at Board of Directors meetings andGovernance Committee meetings, etc. Further, the effectiveness of Audit & Supervisory Committee activities isenhanced through discussions among Independent External Directors alone.

(ii) Status of internal Audits
Internal audits of the Company are implemented by the Internal Audit Department (49 members). The Internal Audit
Department conducts internal audits systematically based on an annual audit plan, regularly reports the results to theRepresentative Director, the Board of Directors and the Audit & Supervisory Committee, and closely exchanges opinions
on mutual recognition of issues and other matters. The General Manager of the Internal Audit Department requests auditees
to take corrective actions on observations identified during internal audits where recommended improvements were
provided and then report the results of those actions. The General Manager also informs the Representative Director aboutsignificant findings to ensure the effectiveness of the audit. The General Manager of the Internal Audit Department has built
cooperative relationships with Audit & Supervisory Committee, corporate auditors and others at Group companies, and the
Accounting Auditor, and this enables exchange of information and other actions on a regular and appropriate basis, in aneffort to conduct audits efficiently. The General Manager also exchanges related information with the departments in chargeof the Risk Management Committee, the Compliance Committee, and others.

- 91 -

(iii) Status of accounting Auditsa. Name of Audit Firm
Deloitte Touche Tohmatsu LLC
b. Continuous Audit Period
The Company (then Diamond Lease Company Limited) concluded an audit agreement with Deloitte Touche Tohmatsu
LLC (then Nishikata Audit Corporation) in 1980. Subsequently, the Company merged with UFJ Central Leasing Co., Ltd.
in April 2007 and became Mitsubishi UFJ Lease & Finance Company Limited, which merged with Hitachi Capital
Corporation in April 2021 and changed its trade name to Mitsubishi HC Capital Inc., and continued to conclude audit
agreements with Deloitte Touche Tohmatsu LLC.
c. Certified Public Accountants who executed the Services
Motohiro Shimizu, Designated Engagement Partner, Certified Public Accountant
Masashi Tsurumi, Designated Engagement Partner, Certified Public Accountant
Aki Saito, Designated Engagement Partner, Certified Public Accountant
d. Composition of Assistants in Audit Duties
The assistants involved in the audit duties of the Company are 14 certified public accountants and 40 other members.
e. Policy and Reason for the Selection of an Audit Firm
In selecting an audit firm, the Company has the policy of deciding on an audit firm after comprehensively evaluating abroad range of items concerning the audit firm that include governance; the status of organizations and systems including
business administration; the status of personnel affairs, such as the policies for recruitment and HR development; andfinancial conditions, all of which are the management basis of audit firm, as well as experience in auditing the industry inwhich the Company operates; the level of understanding of details of the Company group’s business and risks; theavailability of professionals in finance; expertise, such as the status of its overseas network; the status of compliance withrelated laws and regulations; the status of compliance with responding to inspection, etc. of relevant authorities; ensuringof independence; maintenance and improvement of quality management; the system for offering services including
communication with management executives and the Audit & Supervisory Committee; and the level of auditing fees. The
Company concluded that Deloitte Touche Tohmatsu LLC fully satisfied these items and selected the firm as the audit firmof the Company.
When it is recognized that the Accounting Auditor falls under any of the items set forth in Article 340, paragraph 1 of theCompanies Act, the Company considers the dismissal of the Accounting Auditor. When judging that there is an immediateneed for dismissal, the Audit & Supervisory Committee will dismiss the Accounting Auditor based on the consent of all
Audit & Supervisory Committee Members.
In addition to the above, if it is determined that the Accounting Auditor should be changed, such as in cases of obstacles
hindering their ability to execute the duties of Accounting Auditor, the Audit & Supervisory Committee shall decide thedetails of the proposal relating to dismissal or non-reappointment of the Accounting Auditor that will be submitted to theGeneral Meeting of Shareholders.
f. Evaluation of the Audit Firm
The Audit & Supervisory Committee evaluates the audit firm comprehensively concerning matters including the structureof the most recent audit team, the appropriateness of the audit plan, the difference between the plan and the actual results,
and analysis of the causes, in addition to items listed in the reasons for its selection.
(iv) Content, etc. of Audit Fees
a. Fees for Certified Public Accountants, etc. for Audits
Previous Fiscal Year
Category

ReportingFees based on Audit andAttestation Services(Millions of Yen)

Fiscal Year under Review

Fees based on Non-audit
Services(Millions of Yen)

Fees based on Audit andAttestation Services(Millions of Yen)

Fees based on Non-audit
Services (Millions of
Yen)

256

31

264

12

Consolidated
Subsidiaries

194

13

190

27

Total

450

44

454

40

Company- 92 -

(Notes) 1. The content of non-audit services in the Company for the previous fiscal year and the fiscal year under review consistsof preparation of comfort letters, etc.
2. The content of non-audit services in consolidated subsidiaries for the previous fiscal year and the fiscal year underreview consists of preliminary investigation services related to the change of Accounting Auditors and preparation of
comfort letters, etc.
b. Fees for Deloitte Touche Tohmatsu Limited’s Member Firms that belong to the same Network with the Certified Public
Accountants, etc. for Audits (excluding a.)Previous Fiscal Year
Category

ReportingFees based on Audit andAttestation Services(Millions of Yen)

Fiscal Year under Review

Fees based on Non-audit
Services(Millions of Yen)

Fees based on Audit andAttestation Services(Millions of Yen)

Fees based on Non-audit
Services (Millions of
Yen)

–

54

–

38

Consolidated
Subsidiaries

1,132

169

1,230

197

Total

1,132

224

1,230

236

Company(Notes) 1. The content of non-audit services in the Company for the previous fiscal year and the fiscal year under review consistsof tax advisory services, etc.
2. The content of non-audit services in consolidated subsidiaries for the previous fiscal year and the fiscal year underreview consists of tax advisory services, etc.
c. Content of Fees for other important Audit and Attestation Services
There are no important fees for audit and attestation services that some of the consolidated subsidiaries of the Company
paid in the previous fiscal year and the fiscal year under review to certified public accountants for audits, etc. who belong
to networks other than ones that certified public accountants, etc. of the Company belong to.
d. Policy for determining Audit Fees
Although there are no applicable items, they are determined in consideration of the size, characteristics, number of audit
days, etc.
e. Reason why the Audit & Supervisory Committee gave Consent to Fees, etc. for the Accounting Auditor
During the fiscal year under review, the Audit & Supervisory Committee agrees to this remuneration as it has confirmedthat these amounts are determined after sufficient discussion with the Accounting Auditor by using the number of auditingdays and of auditors required to perform appropriate and efficient accounting auditing as the basis for calculation.

- 93 -

(4) Officers’ Remuneration, etc.
(i)

Policy for determining Details, Amount, and Calculation Method of Officer Remuneration, etc. and Method of
Determinationa.

Basic Policyi) For the purpose of enhancing corporate value through the execution of business strategies, the Company also considers
officer incentive when determining officer remuneration.
ii) The level of remuneration shall be appropriate for the roles and responsibilities of each officer, taking into consideration
the level of the market, from the standpoints of enhancing corporate value in the medium to long term and improving
business performance in the short term.

In accordance with the above basic policy, the Board of Directors of the Company has resolved the policy on the details of
remuneration, etc. of individual Directors (excluding Directors who are Audit & Supervisory Committee Members) as follows
in b.
b.

Policy on the Details of Remuneration, etc. of individual Directors (excluding Directors who are Audit & Supervisory
Committee Members)i) Remuneration System• In principle, remuneration, etc. for Executive Directors shall be comprised of basic remuneration, short-term incentive
compensation (performance-based monetary compensation), and medium- to long-term incentive compensation(performance-based stock compensation). Short-term incentive compensation will be paid in cash as a bonus, andmedium- to long-term incentive compensation will be paid as the Company Shares, etc. using a trust framework.
• For the purpose of maintaining a healthy ratio of performance-based compensation, the ratio between fixed remuneration(basic remuneration) and floating compensation (bonus and stock compensation) shall be around 1 to 0.6 (the ratio of
basic remuneration to bonuses to stock compensation shall be around 1 to 0.3 to 0.3).
• From the standpoint of ensuring the effectiveness of the supervisory function, remuneration for non-executive directors(excluding Directors who are Audit & Supervisory Committee Members) does not include bonuses and stockcompensation, which are incentive compensation.

- 94 -

Composition Ratio of Remuneration
0%

10%

20%

Executive Director

30%

40%

50%

60%

70%

80%

90%

62.5%

18.75%

18.75%

1

0.3

0.3

Non-Executive Director

100%

100%
Basic Remuneration

Bonus

Stock-based Compensation Stock Option

・Fixed Remuneration
The amount of fixed remuneration is determined based on the amount corresponding to the position and comprehensive
consideration of the roles, responsibilities, and other factors of each Director.
・Floating Compensation
From the standpoint of clarifying the relationship between performance and remuneration, for bonuses and stockcompensation, the financial indicators, etc. emphasized in the management strategy as indicators representing theCompany’s growth are set as the KPIs for evaluating performance (KPIs and evaluation ratios are shown above).
[Bonus]- (1) Net income attributable to owners of the parent, (2) ROA, and (3) ROE are used, which are set according to theCompany’s numerical targets (KPIs for evaluating company-wide performance).
- In regard to bonuses for Representative Directors, the entire amount is linked to the company-wide performance
evaluation, while the bonus for other Executive Directors is based 70% on the company-wide performance evaluationand 30% on the evaluation of duties for which each individual is responsible. For both positions, the amount of bonuses
to be paid is determined within the range of 0 to 150% of the standard amount based on the achievement rate of KPIs.
- For respective operational responsibilities, a standard evaluation sheet is used by the President & CEO to perform
quantitative and qualitative evaluations from the standpoint of performance and contribution of the Executive Director
with respect to the operations for which they are responsible. The purpose of this is to improve the incentive of
individual Directors by properly evaluating not only the degree of achievement of targets for business results but also thedegree of contribution, which cannot be evaluated solely quantitatively.
[Stock Compensation]- The growth rate of (1) net income attributable to owners of the parent, (2) ROA, (3) ROE, and (4) TSR against TOPIX
growth rate, which has been set as numeral targets in the Medium-term Management Plan to enhance the Company’s
corporate value in the medium to long term, shall be indicators for evaluating performance (KPIs).
- The Company Shares, etc. corresponding to share conversion points, which are calculated as the following formula, areprovided, with the use of the system of trust. Specifically, one Company share shall be provided per one point. In
principle, a portion of shares held by the trust is converted into cash in the trust, and the compensation is paid at apercentage of shares 50% : cash 50%.
Share conversion points = “points granted corresponding to the position and the term of office (accumulated value for aperiod of three years, which is the period of the Medium-term Management Plan) × performance-linked factor (varying
in a range between 0% to 150%) according to the achievement level of KPIs”- 95 -

<Malus and Claw-back Clause for Stock Compensation and Shareholding Policy>- As for stock compensation, the points or share conversion points that have already been granted can be confiscated, andmoney equivalent to the Company Shares, etc. that have already been delivered reclaimed, in the case of a material
violation of the office regulations or internal regulations, resignation for personal reasons during the term of officeagainst the will of the Company, termination for legitimate reasons, gaining employment at a competitor without theCompany’s permission, etc.
- The Company recommends that directors hold the Company’s shares. In principle, directors shall continue to hold theCompany’s shares obtained during the term of their office until the time of their resignation, regardless of the number ofshares held.
・Other Compensation
If a Director (excluding Outside Directors and Directors who are Audit & Supervisory Committee Members) needs tolive in an area far away from his or her home due to a transfer associated with a change in their responsibilities orassigned location, the Director is to be provided with an appropriate property as company housing (hereinafter, thedifference between the total monthly rent required for the Company to rent the company housing and the total amount ofmonthly company housing rent collected from the Director is referred to as “non-monetary remuneration for theprovision of company housing”). The company housing to be provided shall be a general standard property, and the
maximum rent shall be established in advance based on position and geographical area. The company housing rent (ifthe maximum rent is exceeded, the full amount of the excess amount is added) shall be collected from the Director as
their own expenses (there are currently no eligible officers who are provided with company housing).

(ii) Timing or Conditions of Remuneration, etc.
- Basic remuneration shall be paid in a fixed monthly amount on the designated day.
- Bonuses shall be paid in an amount determined based on the results of the previous fiscal year (April to next March) onor after the date of the Annual General Meeting of Shareholders in June of every year.
- As stock compensation, points are granted at the end of every fiscal year (the end of March) corresponding to theposition and number of months in office of the relevant person, in principle. The aggregate number of the said points ofthree years is multiplied by the performance-linked factor to calculate share conversion points, based on which theCompany Shares, etc. are provided in July of the fiscal year following the final fiscal year of the Medium-termManagement Plan period (three years).
- Non-monetary remuneration for the provision of company housing shall be paid monthly in addition to basic
remuneration.

- 96 -

Payment Timing

Subject Period of Payment

Basic Remuneration

Type of Remuneration

A predetermined Date every Month

Every Fiscal Year

Bonus

After an annual General Meeting ofPrevious Fiscal Year (April to next

Shareholders

March)–

Medium-term Management Plan

Stock Compensation

Period (three Years)(a) Points*(b) The Company Shares, etc.

End of every Fiscal Year

Every Fiscal Year

July following the End of theMedium-term Management Plan

Medium-term Management Plan

Period during which (a) was
aggregatedNon-monetary Remuneration

A predetermined Date every Month

Every Fiscal Yearrelated to the Provision ofCompany Housing*

The (b) Company Shares, etc. are provided based on the share conversion points calculated by multiplying thenumber of (a) points aggregated during the Medium-term Management Plan period by the performance-linked
factor.

(iii) Method of Determining Remuneration, etc., Outline of the Committee’s Procedures, and Description of its Activities- The details of remuneration, etc. and the policy for determining remuneration, etc. for Directors (excluding Directors
who are Audit & Supervisory Committee Members) are resolved at meetings of the Board of Directors after preliminary
deliberations by the Compensation Committee, which is comprised of a majority of Independent Outside Directors. The
Compensation Committee also deliberates annually on the appropriateness of the level and composition of remuneration
based on remuneration data and other information provided by external professional organizations.
- The members and chairperson of the Compensation Committee are selected by the Board of Directors, and theCommittee adopts resolutions by a majority of the members present. In addition, the Company’s rules stipulate that theBoard of Directors shall respect the deliberations of the Committee.
- The Company believes it is helpful that the specific amount of basic remuneration and bonuses for Directors (excluding
Directors who are Audit & Supervisory Committee Members), as well as non-monetary remuneration for the provisionof company housing, is determined flexibly based on certain standards by someone who is familiar with individual
operations and the Company’s situation. The decision is thus entrusted to the President & CEO (Taiju Hisai), who is theRepresentative Director, within the upper limit set forth by resolution of the General Meeting of Shareholders, based on
the policy resolved by the Board of Directors and Compensation Committee. The Company will take measures to ensurethat the authority of the President & CEO is appropriately exercised as follows. Regarding stock compensation, theCompany Shares, etc. corresponding to share conversion points calculated based on the regulations for share delivery,
which were stipulated by the resolution of the Board of Directors, shall be provided.
[Measures to ensure that the delegated Authority is properly exercised]- Basic remuneration is determined based on certain pre-established standards (remuneration table) that are deliberated by
the Compensation Committee.
- The following shall apply to the portion of the bonus linked to the company-wide performance:
・KPIs are established according to numerical targets discussed at the Board of Directors.
・The amount to be paid is determined according to the achievement rate of the KPIs based on a predetermined payment
coefficient deliberated by the Compensation Committee.
・The results of the company-wide performance evaluation and the amount to be paid are subsequently reported to theCompensation Committee for verification.
In addition, the following shall apply to the portion of the bonus linked to operational responsibilities:
・After deliberations in advance by the Compensation Committee, an evaluation sheet (an evaluation sheet providing
details on predetermined targets, weighting of individual targets, and evaluation criteria) is finalized.
・After the individual duties are evaluated based on the evaluation sheet, the results and amount to be paid are subsequently- 97 -

reported to the Compensation Committee for verification.
- For stock compensation, points corresponding to the position and number of months in office of the relevant person at
the end of every fiscal year are granted based on the prescribed standards as per the regulations for share delivery, which
are resolved by the Board of Directors. In principle, the performance-linked factor, which is determined upon thecompletion of the Medium-term Management Plan every three years shall also be as per the regulations for sharedelivery.
- Non-monetary remuneration related to the provision of company housing:・The company housing to be provided shall be a general standard property, and the maximum rent shall be established inadvance based on position and geographical area.
・The Company housing rent calculated based on the predetermined percentage (if the maximum rent is exceeded, the fullamount of the excess amount is added) shall be collected from the Director as their own expenses. (There are currently
no eligible officers who are provided with company housing.)
・The Amounts of Remuneration, etc. for Directors have been resolved at the General Meeting of Shareholders as follows.

Type of Remuneration

Amount of Remuneration,etc.

Date of
Resolution by
the General
Meeting of
Shareholders

Number of eligible
Directors at the Timeof the Resolution of
the General Meetingof Shareholders
becoming Effective*

Number of eligible
Directors as of June25, 2024

108

Directors (excluding Directors who are Audit & Supervisory Committee Members)
Monetary Remuneration (total ofbasic remuneration and bonus)
Of these, Outside Directors

Annually ¥800 million
Annually ¥100 million

33

Non-monetary Remuneration
related to the Provision of Company
Housing
Stock Compensation

Monthly ¥2 million

7
Excluding Outside
Directors
4
Excluding Nonexecutive Directors
and Directors notresiding in Japan0(No eligible
Directors)
4

Trust Contribution Amount
Number of Shares Delivered*

February 26,
2021

June 27, 2023
Annually ¥800 million
During subject period¥2,400 million
Annually 1,550 thousand
sharesDuring subject period 4,650
thousand shares

The number of Directors (excluding Directors who are Audit & Supervisory Committee Members) related to theamount of remuneration is not specified.

c.

Matters concerning Calculation of Performance-based Compensation
The amount of performance-based compensation is calculated using the designated formula based on the achievement
rate of each KPI.
[Bonus]- The KPIs for evaluating company-wide performance used for bonuses for Executive Directors are (i) net income
attributable to owners of the parent (weighted at 70%), (ii) ROA (weighted at 15%), and (iii) ROE (weighted at 15%).
- The targets and results for the fiscal year ended March 31, 2024 are as follows.
KPI

TargetResultAchievement Rate

Evaluation WeightNet Income attributable to
Owners of the Parent¥120.0 billion¥123.8 billion

103.2%

70%

ROA

1.1%

1.1%

100.0%

15%

ROE

7.8%

7.7%

98.7%

15%

- For the portion linked to operational responsibilities of Executive Directors other than the Representative Director, thePresident & CEO will use a standard evaluation sheet to perform quantitative and qualitative evaluations from thestandpoint of performance and contribution. Performance targets are set based on the environment of the business incharge, the previous year’s performance, and other factors according to the responsibilities of each Director, andevaluations are performed taking into account the respective performance and contribution.

- 98 -

[Stock Compensation]- The KPIs for stock compensation for executive directors are (i) net income attributable to owners of the parent (weighted
at 60%), (ii) ROA (weighted at 10%), (iii) ROE (weighted at 10%), and (iv) TSR against TOPIX growth rate (weighted
at 20%).
- The targets for the period of the Medium-term Management Plan (FY2023 - FY2025) are as follows.
KPI

TargetResultAchievement Rate

Evaluation Weight¥160.0 billion

–

–

60%

ROA

Approx. 1.5%

–

–

10%

ROE

Approx. 10%

–

–

10%

TSR

TOPIX growth rate

–

–

20%

Net Income attributable to
Owners of the Parent*

Achievement rates for KPIs related to stock compensation are not listed as they will be confirmed after the end of the
final fiscal year of the Medium-term Management Plan (FY2023 - FY2025).

d.

Reasons for the Board of Directors’ Determination that the Content of individual Remuneration of Directors (excluding
Directors who are Audit & Supervisory Committee Members) for the Fiscal Year under Review is appropriate
The specific amount of basic remuneration and bonuses, as well as non-monetary remuneration for the provision ofcompany housing are entrusted to the President & CEO within the upper limit set forth by resolution of the General
Meeting of Shareholders. In addition, as the Company has taken measures as described in [Measures to ensure that thedelegated authority is properly exercised] at b. (iii) above, there is a system for the Compensation Committee and the
Audit & Supervisory Committee to confirm that individual remuneration, etc. for Directors is determined by proceduresthat are objective and transparent, and that the content is in line with the policy established by the Company. The Boardof Directors has determined that the content of individual remuneration, etc. for each Director for the fiscal year underreview is in line with the remuneration policy.

e.

Details and Method of determining Remuneration, etc. of Directors (Audit & Supervisory Committee Members)- For Directors (Audit & Supervisory Committee Members), from the standpoint of ensuring the fairness of audits,
bonuses and stock-based compensation, which are incentive compensation, shall not be paid. Remuneration shall belimited to basic remuneration only.
- The amount of remuneration for Directors (Audit & Supervisory Committee Members) is to be determined throughdiscussion by Directors who are Audit & Supervisory Committee Members within the range decided with the resolutionof the General Meeting of Shareholders (the table below).

Type of Remuneration

Amount of Remuneration

GeneralMeeting of
Shareholders
Date of
Resolution

Number of eligible
Directors at the Time of
the Resolution of theGeneral Meeting of
Shareholders becoming
Effective*

Number of eligible
Directors as of June25, 2024

5

4

Director (Audit & Supervisory Committee Member)
Monetary remuneration (basic
remuneration)*

Annually ¥200 million

February 26,
2021

The number of Directors (Audit & Supervisory Committee Members) related to the amount of remuneration is not
specified.

- 99 -

(ii) Total Amount of Remuneration, etc. by Officer Category, total Amount of Remuneration, etc. by Type, and Number of
eligible Officers
Total Amount of Remuneration, etc. by Type (Millions of Yen)

Amount of

Fixed
Remuneration(BasicRemuneration)

Performancebased
Compensation(Bonus)Performancebased
Compensation(StockCompensation)

422

298

55

68

–

6

49

49

–

–

–

1

91

91

–

–

–

7

Remuneration

Officer Category(Millions ofYen)

Number of eligible Officers(Persons)

Other

Directors who are Not Audit &Supervisory Committee
Members (excluding Outside
Directors)
Directors who are Audit &Supervisory Committee
Members (excluding Outside
Directors)
Outside Directors(Notes) 1.

The amount of performance-based compensation (bonus) is the amount of reversal of provision for bonuses for
directors (and other officers) for the fiscal year under review.
2. The total amount for performance-based compensation (stock compensation) is the amount of expenses posted
for points awarded during the fiscal year under review.
3. There were no payments of non-monetary compensation related to the provision of company housing during the
fiscal year under review.
4. The table above includes remuneration, etc. paid to one Director who resigned due to his passing on January 4,2024.

(iii) Total Amount of Remuneration, etc. paid by the Group to Each Officer

NameTotal Amountof
Remuneration
Officer Company, etc. paid by
the Group Category Category(Millions ofYen)

Taiju Hisai

123

Director

Amount of Remuneration, etc. paid by the Group by Type (Millions of Yen)
Fixed
Remuneration(BasicRemuneration)

Reportingcompany74

Performance-based
Compensation(Bonus)21

Performance-based
Compensation(StockCompensation)
27

Other

–

(Notes) 1.

The amount of performance-based compensation (bonus) is the amount of reversal of provision for bonuses for
directors (and other officers) for the fiscal year under review.
2. The total amount for performance-based compensation (stock compensation) is the amount of expenses posted
for points awarded during the fiscal year under review.

(5) Status of Shareholdings(i)

Investment Share Classification Standards and Approach
For the classification of investment shares for pure investment purposes and those for purposes other than pure investment,
the Company classifies investment shares held solely for the purpose of targeting gains through fluctuations in the value ofshares or the receipt of dividends related to shares into investment shares for pure investment purposes; and classifies thosewith a view to developing long-term and stable relationships with business partners and promoting business, and those forthe purpose of strengthening relationships based on continuous capital and business alliances into investment shares forpurposes other than pure investment.

(ii) Investment Shares for Purposes Other than Pure Investmenta.

Methods of Verifying the Shareholding Policy and the Reasonableness of Shareholdings, and the Content of the Verificationby the Board of Directors, etc. concerning the Rationality of the Holding of individual Issues
Under the corporate policy of enhancing its corporate value, the Company holds shares for purposes other than pure investment
with a view to “developing stable and long-term relationships with business partners, promoting business,” along with“strengthening such relationships based on capital/business alliances, and creation of new business opportunities.” The- 100 -

Company’s basic policy is to examine annually if it is rational to hold each stock and sell such shares when it is judged nolonger rational to hold them, taking into account the impacts on business and markets, and after obtaining understanding frombusiness partners. Even when it is judged rational to hold shares, the Company may sell such shares in consideration of the
impact of the risk of mark-to-market valuation fluctuations of the shares on the Company’s finance, capital efficiency, etc.
(Out of investment shares for purposes other than pure investment, the description herein refers to shares other than unlisted
stocks.)The methods for verifying the rationality of the shareholdings employ the following main items to verify: (i) A quantitativeevaluation based on factors including the size of business transactions/profit, dividends received, and capital costs, (ii) A
qualitative evaluation of the business activities to date and potential business opportunities in the future. The Board of
Directors verifies the rationality of shareholdings.
The Company examined all of the relevant investment shares using the above methods at the Board of Directors meeting heldin the fiscal year ended March 2024.
b. Number of Issues and Amount recorded on the Balance Sheet
Number of
Total Amount recorded on theIssuesBalance Sheet (Millions of Yen)
(Issues)
Unlisted Stocks

87

5,109

Stocks other than unlisted
Stocks31

18,725(Issues that increased in the Number of Shares held in the Fiscal Year under Review)
Number of Total Acquisition Cost related
to an Increase in the Number ofIssues(Issues)
Shares held (Millions of Yen)
Unlisted Stocks

6488

Reason for the Increase in the Number of
SharesInvested in startups with the aim ofpromoting the creation of new services anddevelopment of new businesses.

Stocks other than unlisted
Stocks－－－(Note) Issues with an increased or decreased number of shares do not include changes caused by stock consolidation, stock
splits, stock transfers, stock exchange, mergers, etc.
(Issues that decreased in the Number of Shares held in the Fiscal Year under Review)
Number ofIssues(Issues)

Total Sales Amount related to a
Decrease in the Number of
Shares held (Millions of Yen)

Unlisted Stocks

8

1,847

Stocks other than unlisted
Stocks22

8,147- 101 -

c.

Information on the Number of specified Investment Stocks and Deemed Holdings of Shares by Issue and Amounts recordedon the Balance Sheet, etc.
Specified Investment Stock

IssuesDuring the Fiscal
Previous Fiscal Year
Year under Review
Number of Shares
Number of Shares(Shares)(Shares)Amount recorded on Amount recorded on
the Balance Sheet
the Balance Sheet(Millions of Yen)
(Millions of Yen)

Purpose of Holding, Overview of Business
Alliance, etc., Quantitative Holding Effectand Reason for Increase in the Number of
SharesHolding of
Shares in the
Company

Mainly held to maintain and strengthen
901,092

1,351,492

Aeon Co., Ltd.
3,239

3,467

comprehensive business relationships
including leases in the Customer Solutions
segment. During the fiscal year underreview, the Company sold a portion of its

Noshareholding.
562,689

187,563

Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions
segment. Please note that a 3-for-1 split ofTokyo Ohka Kogyo
Co., Ltd.
2,576

1,442

No

ordinary shares was carried out on January
1, 2024. The number of shares for the fiscal
year under review are after the share split.

430,000

Mainly held to maintain and strengthen

1,818

1,780

comprehensive business relationships
including leases in the Customer Solutions

768,634

768,634

Mainly held to maintain and strengthen
comprehensive business relationships

1,683

1,521

including leases in the Customer Solutions
segment.

221,600

221,600

Mainly held to maintain and strengthen
comprehensive business relationships

1,577

1,309

including leases in the Customer Solutions
segment.

76,20076,200Mainly held to maintain and strengthen

1,288

790

comprehensive business relationships
including leases in the Customer Solutions

216,500

216,500

Mainly held to maintain and strengthen

1,073

1,104

comprehensive business relationships
including leases in the Customer Solutions

125,000

125,000

782

530

302,964

302,964645

680

920,000

920,000

531

544

430,000
Shimadzu Corporation

Tokai Corp.

Okuma Corporation

Okaya & Co., Ltd.

Mitsubishi ResearchInstitute, Inc.

Jeol Ltd.

Zeria PharmaceuticalCo., Ltd.

Bangkok Bank PublicCo., Ltd.

- 102 -

No

segment.

Yes

Yes

Yes

segment.

No

segment.
Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions
segment.
Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions
segment.

No

Yes

Mainly held to maintain and strengthen
cooperative relationships at the Company’s
overseas local subsidiaries

NoIssuesDuring the Fiscal
Previous Fiscal Year
Year under Review
Number of Shares
Number of Shares(Shares)(Shares)Amount recorded on Amount recorded on
the Balance Sheet
the Balance Sheet(Millions of Yen)
(Millions of Yen)
142,400

142,400

447

339

183,000

243,900

GS Yuasa Corporation

Nagoya Railroad Co.,
Ltd.
396

498

113,000

113,000

394

446

633,937

633,937386

232

134,000

134,000

216

106

179,450

179,450205

169

50,64150,641

Nippo Ltd.

SENKO Group
Holdings Co., Ltd.

Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions
segment.

Holding of
Shares in the
CompanyNo

Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions
segment. During the fiscal year under

Nachi-Fujikoshi Corp.

Tokai Tokyo Financial
Holdings, Inc.

Purpose of Holding, Overview of Business
Alliance, etc., Quantitative Holding Effectand Reason for Increase in the Number of
SharesYes

review, the Company sold a portion of its
shareholding.
Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions

No

segment.
Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions

Yes

segment.
Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions
segment.
Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions
segment.

No

Yes

The Company entered into a businessalliance agreement with the said company
for the purpose of collaboration in thecommunications infrastructure sharing
sector. Held to maintain and strengthen

JTower Inc.
200

248

No

cooperative relationships with the said
company in establishing a finance scheme
related to capital investment in the sector.
The Company entered into a business

57,140*alliance agreement with the said company
for the purpose of strengthening
collaboration on accelerating DX and SDGs
in the aviation industry. Held to maintain

AeroEdge Co., Ltd.

and strengthen cooperative relationships
with the said company, mainly in the area of
183*

DX for parts production in the aviationindustry and others. Became subject todescription from the fiscal year underreview due to its new listing.

- 103 -

No

IssuesDuring the Fiscal
Previous Fiscal Year
Year under Review
Number of Shares
Number of Shares(Shares)(Shares)Amount recorded on Amount recorded on
the Balance Sheet
the Balance Sheet(Millions of Yen)
(Millions of Yen)
101,970

101,970181

168

212,000

212,000

151

127

250,000

500,000

Meito Sangyo Co.,Ltd.

The Torigoe Co., Ltd.

Purpose of Holding, Overview of Business
Alliance, etc., Quantitative Holding Effectand Reason for Increase in the Number of
Shares
Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions
segment.
Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions
segment.

Holding of
Shares in the
Company

Yes

No

Mainly held to maintain and strengthen

JDC Corporation
134

302

comprehensive business relationships
including leases in the Customer Solutions
segment. During the fiscal year underreview, the Company sold a portion of its

Noshareholding.
The Company entered into a business
115,000

115,000

Iseki & Co., Ltd.

Japan Transcity
Corporation

118

136

services related to agricultural machines
and others sold by the said company’s

150,491

150,491

Mainly held to maintain and strengthen

101
38,16091
38,160

Okamura Corporation
86

52

48,80048,80080

5926,302

26,30266

58

39,60039,600Mitsumura Printing
Co., Ltd.

Imuraya Group Co.,Ltd.

Yahagi Construction
Co., Ltd.

Yamada Holdings Co.,Ltd.

alliance agreement with the said company
for the purpose of providing financial

61

32

100,000

100,000

44

45- 104 -

No

group. Held to maintain and strengthen
partnership in the agricultural sector.
comprehensive business relationships
including leases in the Customer Solutions

No

segment.
Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions

No

segment.
Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions
segment.
Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions
segment.

Yes

No

Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions

No

segment.
Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions
segment.

NoIssuesDuring the Fiscal
Previous Fiscal Year
Year under Review
Number of Shares
Number of Shares(Shares)(Shares)Amount recorded on Amount recorded on
the Balance Sheet
the Balance Sheet(Millions of Yen)
(Millions of Yen)
40,00040,00027

2740,08040,080

12

10

Yamanaka Co., Ltd.

Altech Co., Ltd.

Purpose of Holding, Overview of Business
Alliance, etc., Quantitative Holding Effectand Reason for Increase in the Number of
Shares
Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions
segment.
Mainly held to maintain and strengthen
comprehensive business relationships
including leases in the Customer Solutions
segment.

Holding of
Shares in the
Company

Yes

No

Mainly held to maintain and strengthenJAPAN CRAFT

comprehensive business relationships
including leases in the Customer Solutions

HOLDINGS CO.,LTD.

segment. Please note that a 2-for-1 split ofordinary shares was carried out on July 1,

58,00029,0009162023. The number of shares for the fiscal
year under review are after the share split.

–

1,581,298,147

The Company held the shares to maintainand strengthen cooperative relationships,

–

1,534

but sold all of its shareholding during the
fiscal year under review.

–

210,080

The Company held the shares to maintain

–

1,103

and strengthen cooperative relationships,
but sold all of its shareholding during the–482,064

The Company held the shares to maintain–754

and strengthen the relationship, but sold allof its shareholding during the fiscal year–

165,375–421

of its shareholding during the fiscal year
under review.

–

60,000

The Company held the shares to maintainand strengthen the relationship, but sold all–

331

of its shareholding during the fiscal year
under review.

–

200,000

The Company held the shares to maintain–244

and strengthen cooperative relationships,
but sold all of its shareholding during the–42,907The Company held the shares to maintain–176

and strengthen the relationship, but sold allof its shareholding during the fiscal year–

66,800

The Company held the shares to maintainand strengthen the relationship, but sold all–

137

of its shareholding during the fiscal year
under review.

PT GoTo Gojek
Tokopedia Tbk

Sompo Holdings, Inc.

Rock Field Co., Ltd.

Tokio Marine
Holdings, Inc.

Taisho Pharmaceutical
Holdings Co., Ltd.

Cyfuse Biomedical
K.K.

MS&AD InsuranceGroup Holdings, Inc.

Hirano Tecseed Co.,Ltd.

- 105 -

No

No

No

fiscal year under review.

Yesunder review.
The Company held the shares to maintainand strengthen the relationship, but sold all

No

No

No

fiscal year under review.

No

under review.
Previous Fiscal
Year: Yes
Fiscal Yearunder Review:NoIssuesDuring the Fiscal
Previous Fiscal Year
Year under Review
Number of Shares
Number of Shares(Shares)(Shares)Amount recorded on Amount recorded on
the Balance Sheet
the Balance Sheet(Millions of Yen)
(Millions of Yen)
188,200–

120

of its shareholding during the fiscal year
under review.

–

60,000

The Company held the shares to maintain–106

and strengthen the relationship, but sold allof its shareholding during the fiscal year–

53,200

The Company held the shares to maintain–81

and strengthen the relationship, but sold allof its shareholding during the fiscal year–

49,812–77–

60,000–72

of its shareholding during the fiscal year
under review.

–

30,626The Company held the shares to maintain–67

and strengthen the relationship, but sold allof its shareholding during the fiscal year–

64,700

The Company held the shares to maintain–65

and strengthen the relationship, but sold allof its shareholding during the fiscal year–

37,500–58–

13,310–30

of its shareholding during the fiscal year
under review.

–

9,466

The Company held the shares to maintain–11

and strengthen the relationship, but sold allof its shareholding during the fiscal year

–

5,000

The Company held the shares to maintain4

and strengthen the relationship, but sold allof its shareholding during the fiscal year

SoftBank Corp.

Tsuzuki Denki Co.,Ltd.

Meiji ElectricIndustries Co., Ltd.

Kisoji Co., Ltd.

Waida MFG. Co., Ltd.

Hochiki Corporation

Koike Sanso Kogyo
Co., Ltd.

Aska Pharmaceutical
Holdings Co., Ltd.

The Company held the shares to maintainand strengthen the relationship, but sold all–
Freund Corporation

SK-Electronics Co.,Ltd.

Purpose of Holding, Overview of Business
Alliance, etc., Quantitative Holding Effectand Reason for Increase in the Number of
SharesEncho Co., Ltd.
–

Holding of
Shares in the
CompanyNoNounder review.

No

under review.
The Company held the shares to maintainand strengthen the relationship, but sold allof its shareholding during the fiscal year
under review.
The Company held the shares to maintainand strengthen the relationship, but sold all

No

Yes

No

under review.

No

under review.
The Company held the shares to maintainand strengthen the relationship, but sold allof its shareholding during the fiscal year
under review.
The Company held the shares to maintainand strengthen the relationship, but sold all

No

No

No

under review.

No

under review.

(Notes) 1. The quantitative holding effect is verified for each individual issue using the method described in (ii) a. above, but is notdescribed for confidentiality reasons.
2. A hyphen “–” indicates that the Company does not hold the relevant issue.
3. An asterisk “*” indicates that the information was omitted because the relevant issue was unlisted stock.

- 106 -

(iii) Investment Stocks for Pure Investment Purposes
During the Fiscal Year under Review
Category

Total Amount recordedon the Balance Sheet(Millions of Yen)

Number of Issues(Issues)

Unlisted Stocks

Previous Fiscal Year5

Total Amount recordedon the Balance Sheet(Millions of Yen)

Number of Issues(Issues)

4,322

Stocks other than unlisted
Stocks

1

1,650

–

–

During the Fiscal Year under Review
Category143–

Total unrealized Gains(Losses) (Millions of
Yen)
–

–

–

–

Total Dividends received Total Gain (Loss) on Sale(Millions of Yen)
(Millions of Yen)

Unlisted Stocks
Stocks other than unlisted
Stocks(Note) As unlisted stocks do not have market prices, “Total unrealized gains (losses)” are not stated.
(iv) There are no investment shares reclassified from held for pure investment to held for other than pure investment during the
fiscal year under review.
(v) There are no investment shares reclassified from held for other than pure investment to pure investment during the fiscal year
under review.

- 107 -