Corporate Governance Report
Last Update: June 27, 2024

Zensho Holdings Co., Ltd.
Kentaro Ogawa
Representative Director, Chairman, President & CEO
Contact: Group General Affairs Division; +81-3-6833-1600
Securities Code: 7550
https://www.zensho.co.jp/en/
The corporate governance of Zensho Holdings Co., Ltd. (the “Company”) is described below.

I.

Basic Views on Corporate Governance, Capital Structure, Corporate Profile andOther Basic Information

1. Basic Views
The Company’s mission is “providing safe and delicious food at affordable prices to people throughout theworld.” To this end, we operate an excellent global Mass Merchandising System (MMD) developed in-house,
in which we plan and design the entire process involving food to take full responsibility for our food safety
and quality with a consumer-first mindset. Company members who share this mission make up and maintainour organic and effective organization.
On the business administration front, four out of nine Directors (excluding Directors who are Members of the
Audit & Supervisory Committee), as well as all four Directors who are Members of the Audit & Supervisory
Committee, are Outside Directors, with a view to establishing a fair governance structure. Furthermore, inline with its basic policy on establishment of internal control systems, the Company has developed systems
for ensuring legal compliance and managing risks, and is making use of internal checks by the internal audit
division and accounting audits by the Accounting Auditor to further enhance its corporate governance.
Moreover, the Company endeavors to increase transparency of business management through results
briefings, investor relations (IR) activities, disclosures through the corporate website and other means, anddirect engagement with shareholders at General Meetings of Shareholders.

[Reasons for Non-compliance with the Principles of the Corporate Governance Code][Supplementary Principle 4.1.3 Roles and responsibilities of the Board of Directors (1)]⚫ Successors for the CEO and other top executives will be selected from among candidates who are
deemed the most suited in consideration of factors including their character, knowledge, track record,
and understanding of the Company’s business philosophy, upon providing frequent job rotations andtrainings for development. The Board of Directors will supervise the development and selection process.

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[Disclosure Based on the Principles of the Corporate Governance Code] Updated[Principle 1.4 Cross-shareholdings]⚫ The Company currently does not hold cross-shareholdings. When holding cross-shareholdings, theCompany assesses whether to do so on an individual basis by deliberating from the perspective ofensuring the holding purpose is in line with the Company’s business strategies and medium- to longterm economic rationale. Moreover, the Company will endeavor to disclose its policies on reduction ofcross-shareholdings and standards on exercise of voting rights.
[Principle 1.7 Related party transactions]⚫ When the Group intends to engage in a transaction with a related party, such as its officer or major
shareholder, the Group submits a proposal on the transaction to the Board of Directors in advance andobtains its approval pursuant to the Board of Directors Regulations, in order to ensure such transactions
do not hinder interests of the Group or common interests of shareholders. The Group also verifies theresults of these transactions to confirm they were carried out under terms equivalent to generaltransactions in light of fair values and market prices.
[Supplementary Principle 2.4.1 Ensuring diversity, including active participation of women]⚫ The Company has long envisioned to be “an energetic organization that values diversity, initiative, andcreativity, in which each and every individual can work with vigor,” as stipulated in the “Zensho Group
Charter,” which prescribes code of conduct for its employees. Having developed human resource andorganizations to achieve this vision, the Company promotes employees to managerial positions whileconsidering diversity in gender, nationality, professional background, etc. In addition, the Company
strives to create an internal environment that facilitates active participation of diverse human resource,by setting up childcare facilities at its offices, creating childcare and family care leave and other systems,
and providing internal training on diversity.
At Zensho Holdings Co., Ltd., female employees accounted for 25.2% of all employees as of March 31,
2024, with 15.0% of employees in managerial positions being women and one female Director in office.
Foreign nationals and mid-career hires comprise 1.8% and 50.1% of employees in managerial positions,
respectively. The Company will strive to further improve the environment with the goal of increasing
the ratio of female employees in managerial positions to 30% by the end of March 2029.
[Principle 2.6 Roles of corporate pension funds as asset owners]⚫ The Company employs a defined contribution plan, and therefore does not manage corporate pension
funds on its own or outsource the management to external institutions.
[Principle 3.1 Full disclosure](1) Management vision, business strategies, management plans⚫ The Group, under the business philosophy “to eradicate hunger and poverty from the world,” endeavors
to fulfill its mission of “providing safe and delicious food at affordable prices to people throughout theworld.” On the sustainability front, the Company strives to curb CO2 emissions by installing solar power
generation equipment, creating stores with smaller environmental footprint, and reducing energy
consumption with facility upgrades. It also helps developing countries promote agriculture and provides
support for producers by facilitating fair trade.
⚫ The Company prepares and discloses medium-term management plans.
(2) Basic policy on corporate governance⚫ The Company has established its “Basic Policy on Corporate Governance,” which is disclosed on its
website (https://www.zensho.co.jp/jp/company/governance/).
(3) Compensation for Directors⚫ The Company has established its Policy for Determining Content of Individual Compensation, etc., for
Directors, determined by the Board of Directors based on reports from the Nomination andCompensation Committee. This policy is disclosed in the Annual Securities Reports and Notices ofOrdinary General Meeting of Shareholders.
(4) Appointment, dismissal, and nomination⚫ The Company has set up a Nomination and Compensation Committee as an advisory body to the Boardof Directors, with a view to enhancing transparency and objectivity of the nomination process for
Director candidates and candidates for Directors who are Members of the Audit & Supervisory
Committee. Based on recommendations of the Nomination and Compensation Committee, the Board of-2-

Directors holds discussions and selects candidates (Executive Officers are determined by the Board of
Directors).
⚫ In case of grounds for dismissal of a member of the senior management, such as causing significant
damage to the Company or executing their duties inappropriately, the Board of Directors will holddiscussions and take measures in accordance with internal procedures.
(5) Explanation on individual appointment, dismissal, and nomination⚫ Based on reports of the Nomination and Compensation Committee, a Director in charge provides
explanations on individual appointment, dismissal, and nomination.
[Supplementary Principle 3.1.3 Sustainability initiatives]<Sustainability initiatives>⚫ The Company operates its business under the management vision to “eradicate hunger and poverty fromthe world,” a longstanding commitment since its establishment. As such, it regards medium- to longterm sustainability as a key management priority and has been working on it in turn. The Company willfurther evolve its business philosophy and commit itself to sustainability with a view to “taking
responsibility for the stability and development of human society through food.” As its specificsustainability initiatives, the Company has provided agriculture-related technical assistance todeveloping countries, helped with building educational institutions, waterworks and sewage systems,
and medical facilities, and offered support for female producers through fair trade in coffee, tea, andother products since 2007. The Company now conducts fair trade programs in 20 countries. The Groupalso engages in environmental conservation such as by installing solar power generation equipment at
Hama-Sushi stores and factories, curbing CO2 emissions through energy consumption cuts with
development of stores with smaller environmental footprint and facility upgrades, reducing food loss
through the introduction of straight-line conveyor belts at Hama-Sushi stores, and conserving eel(aquaculture resource) through the Eel Foundation. For information on sustainability initiatives, “theZensho Group’s Approach to Sustainability,” “Materiality,” etc., please visit the Company’s website(https://www.zensho.co.jp/jp/sustainability).
<Investment in human capital, intellectual property, etc.>⚫ In accordance with the concept that human resources are “human assets,” that is, capital that generate
added value, the Company works to secure sufficient budget for training and maintain a competitive
level of compensation, based on the basic policy to develop competent human resource such as byoperating training and qualification systems for each professional field, strategically reassigning
employees, and facilitating self-improvements. The Company has also established the Zensho ResearchInstitute, an internal think tank, as well as the Japan Cultural Training Center, a training facility for
managers, to enrich the general knowledge of employees and raise their level of knowledge and culture.
As for investment in intellectual property, the Company has set up an in-house research division such as
the Central Institute for Science and Technology, to advance technological development and basic
research based on medium- to long-term business strategies.
<Disclosure based on the TCFD recommendations or an equivalent framework>⚫ Disclosure of governance structure related to sustainability, impact of risks and revenue opportunities
related to climate change on the Group’s business activities and profit, and other information is provided
in Annual Securities Reports.
[Supplementary Principle 4.1.1 Roles and responsibilities of the Board of Directors (1)]⚫ The Company requires resolution by the Board of Directors for the following matters:(1) Matters provided for in the Companies Act and other laws and regulations(2) Matters provided for in the Articles of Incorporation(3) Matters provided for in the Board of Directors Regulations
The following matters require reporting to the Board of Directors:(1) State of business execution and other matters provided for in the Companies Act and other laws andregulations(2) Other matters deemed necessary by the Board of Directors
Accordingly, matters other than the above have been delegated to management.
[Principle 4.9 Independence standards and qualification for independent Directors]⚫ The Company’s standards for independent officers are as follows:(1) Those who meet the independence criteria stipulated by the Tokyo Stock Exchange(2) Those who have excellent integrity, insight, and capabilities, as well as wide-ranging knowledge-3-and experience and strong track record in a specialized field, with a view to incorporating diverse
perspectives into the Company’s Board of Directors(3) Those who can fully understand the Group’s business philosophy[Supplementary Principle 4.10.1 Use of optional approach]⚫ The Company transitioned into a company with audit and supervisory committee in June 2019, and has
established a Nomination and Compensation Committee, a majority of whose members are independent
Outside Directors. Furthermore, the Nomination and Compensation Committee holds its meetings anddeliberates on matters independent of the Board of Directors. When considering nomination andcompensation of Directors, the committee considers diversity and skills of candidates by referencing theskill matrix for incumbent Directors, and reports its findings to the Board of Directors. Independence ofcommittee member selection and roles of the committee are as disclosed in this report.
[Supplementary Principle 4.11.1 Preconditions for effectiveness of the Board of Directors]⚫ The Company stipulates in its Articles of Incorporation to have no more than 15 Directors (excluding
Directors who are Members of the Audit & Supervisory Committee) and no more than five Directors
who are Members of the Audit & Supervisory Committee. Having disclosed knowledge, experience, andskills of each Director in a skill matrix, the Company ensures they have expertise in current and futurebusiness domains of the Group, and endeavors to maintain diversity of its members so that discussions
at meetings of the Board of Directors reflect various perspectives. When selecting Directors, the Boardof Directors appropriately deliberates and makes decisions at meetings involving Outside Directors
based on reports of the Nomination and Compensation Committee, in light of corporate earnings,
evaluations of divisions in charge, and other factors.
[Supplementary Principle 4.11.2 Preconditions for effectiveness of the Board of Directors]⚫ Directors and Directors who are Members of the Audit & Supervisory Committee of the Company are
required to make the necessary time to understand the Company’s businesses and operations, and prepare
for and attend meetings of the Board of Directors. Accordingly, if they concurrently serve as officers atother listed companies, the Company will disclose in Notices of General Meeting of Shareholders theirattendance at meetings of the Board of Directors and meetings of the Audit & Supervisory Committee,
as well as names of companies at which they concurrently hold positions, to determine if the number ofcompanies concurrently serving at is appropriate.
[Supplementary Principle 4.11.3 Preconditions for effectiveness of the Board of Directors]⚫ With a view to enhancing the effectiveness of the Board of Directors as a whole, the Company analyzes
and evaluates the effectiveness by conducting questionnaires with all members of the Board of Directors
every year. The Company believes its Board of Directors is functioning effectively, given that
discussions at its meetings are always lively with suggestions from diverse perspectives, and that these
opinions and suggestions are often reflected in actual programs and policies.
[Supplementary Principle 4.14.2 Director training]⚫ The Company provides opportunities for newly appointed Directors and Directors who are Members of
the Audit & Supervisory Committee to obtain required knowledge on the Company’s business, finance,
organization, etc. at the time of appointment. The Company has designated certain divisions to provide
the training based on a standard format. Furthermore, the Company offers additional training
opportunities as needed on matters required for Directors and Directors who are Members of the Audit& Supervisory Committee to appropriately carry out their delegated duties and supervise management.
[Principle 5.1 Policy for constructive dialogue with shareholders]⚫ The Company makes a reasonable effort to accommodate requests for dialogue from shareholders, sothat such dialogue contributes to the Company’s sustained growth and improvement of its corporate
value over the medium to long term. To this end, the Group Finance Department, Public Relations Office,and General Affairs Department respectively take charge of communication with institutional investors,
general media, and individual investors. These three divisions work together to improve external
communication.
⚫ In addition, the Company holds results briefings for interested institutional investors, and opinions given
at briefings are relayed to executives as needed.

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[Principle 5.2 Formulation and disclosure of management strategies and plans]<Response to achieve management conscious of capital costs and stock prices> [English disclosure available]⚫ When disclosing its medium-term management plans and budgets, the Company presents target revenue
amounts, capital efficiency such as ROE, as well as key focus items in its business portfolio, and plansfor capital investments and new store openings. It will continue to strive to explain its strategies andplans in a clear and understandable manner.

2. Capital Structure
Foreign Shareholding Ratio Updated

10% or more but less than 20%[Status of Major Shareholders] Updated
Name / Company Name

NumberOwned

Nihon Create Co., Ltd.
The Master Trust Bank of Japan, Ltd. (Trustaccount)
Custody Bank of Japan, Ltd. (Trust account)
Kentaro Ogawa
Kazumasa Ogawa
Yohei Ogawa
Zensho Group Employee Stock Ownership
Association
STATE STREET BANK WEST CLIENT TREATY 505234
JP MORGAN CHASE BANK 385781
SSBTC CLIENT OMNIBUS ACCOUNT
Controlling Shareholder (except for Parent
Company)
Parent Company

ofSharesPercentage (%)

52,307,500
12,517,900

33.33
7.98

4,855,800
3,170,408
3,160,800
3,160,800
2,786,622

3.09
2.02
2.01
2.01
1.78

1,890,700

1.20

1,221,269
884,674

0.78
0.56

―
None

Supplementary Explanation Updated
On May 24, 2024, Kentaro Ogawa, Kazumasa Ogawa, and Yohei Ogawa each transferred 2,670,408 shares,
2,660,800 shares, and 2,660,800 shares, respectively, of the Company’s common stock to Nihon Create Co.,
Ltd.

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3. Corporate Attributes

Fiscal Year-End

Tokyo Stock Exchange
Prime Market
MarchType of Business

Retail Trade

Listed Stock Market and Market Section

Number of Employees (consolidated) as of the
End of the Previous Fiscal YearSales (consolidated) as of the End of thePrevious Fiscal Year
Number of Consolidated Subsidiaries as of the
End of the Previous Fiscal Year

More than 1,000
From 100 billion yen to less than 1 trillion yen
From 100 to less than 300

4. Policy on Measures to Protect Minority Shareholders in Conducting Transactions with Controlling
Shareholder―

5. Other Special Circumstances which may have Material Impact on Corporate Governance―-6-II. Business Management Organization and Other Corporate Governance Systems
regarding Decision-making, Execution of Business, and Oversight in Management
1. Organizational Composition and Operation
Company with audit and supervisory committee

Organization Form
[Directors]
Maximum Number of Directors Stipulated in
Articles of Incorporation
Term of Office Stipulated in Articles ofIncorporation20
1 yearChairperson of the Board

President

Number of Directors

13Election of Outside Directors

ElectedNumber of Outside Directors

8

Number of Independent Directors

8Outside Directors’ Relationship with the Company (1)NameAttribute

Relationship with the Company*
a

b

c

d

e

f

g

h

i

j

k

Chiaki Ito
From another company
Takaharu Ando
Other
Shoei Yamana
From another company
Reiko Nagatsuma
From another company
Hideo Watanabe
From another company
Yukio Miyajima
From another company
Kenichi Kaneko
From another company
Hisashi Maruyama
From another company*
Categories for “Relationship with the Company”* ”○” when the director presently falls or has recently fallen under the category;“△” when the director fell under the category in the past
* “●” when a close relative of the director presently falls or has recently fallen under the category;“▲” when a close relative of the director fell under the category in the pasta. Executive of the Company or its subsidiaries
b. Non-executive director or executive of a parent company of the Company
c. Executive of a fellow subsidiary company of the Company
d. A party whose major client or supplier is the Company or an executive thereof
e. Major client or supplier of the listed company or an executive thereof
f. Consultant, accountant or legal professional who receives a large amount of monetary consideration or otherproperty from the Company besides compensation as an officer
g. Major shareholder of the Company (or an executive of the said major shareholder if the shareholder is alegal entity)
h. Executive of a client or supplier company of the Company (which does not correspond to any of d, e, or f)(the director himself/herself only)
i. Executive of a company, between which and the Company outside officers are mutually appointed (thedirector himself/herself only)-7-

j. Executive of a company or organization that receives a donation from the Company (the director
himself/herself only)
k. Others

Outside Directors’ Relationship with the Company (2) Updated

Name

Membershipof Audit &Supervisory
Committee

Designationas
Independent
Director

Supplementary
Explanation of
the Relationship
OutsideDirector, OBIC
Business
Consultants Co.,Ltd.

○

Chiaki Ito-8-

Reasons of Appointment
The Company expects him toprovide advice on its businessactivities based on his wealth oftechnological knowledge andexperience in the information
telecommunications technology
sector, as well as wide insight as acorporate manager over many years.
Mr. Ito is neither an executive of afellow subsidiary company of theCompany, an executive of a majorclient or supplier of the Company,or an attorney, accountant, or
consultant who receives a large
amount of monetary considerationor other property from the Company
besides compensation as an officer,
nor a close relative of any of them.
He does not fall under any of thecases provided for in stock
exchange regulations as requiringexplanation on independence, andhe maintains independence such as
not being a major shareholder of theCompany. Accordingly, theCompany has designated Mr. Ito as
an independent officer.

Name

Membershipof Audit &Supervisory
Committee

Designationas
Independent
Director

Supplementary
Explanation of
the Relationship○

OutsideDirector,
Amuse Inc.
OutsideDirector, Tobu
Railway Co.,Ltd.
OutsideDirector(Member of the
Audit &
Supervisory
Committee),
Nisshin Seifun
Group Inc.
OutsideDirector,
Rakuten Group,Inc.

○

OutsideDirector, TDK
Corporation
OutsideDirector,
JAPAN POST
INSURANCE
Co., Ltd.
OutsideDirector, SCSKCorporation

Takaharu Ando

Shoei Yamana-9-

Reasons of Appointment
The Company expects him toprovide advice on its businessactivities based on his wealth ofexperience and wide insight fromhaving served in important positions
such as Commissioner General of
the National Police Agency. Mr.
Ando is neither an executive of afellow subsidiary company of theCompany, an executive of a majorclient or supplier of the Company,or an attorney, accountant, or
consultant who receives a large
amount of monetary considerationor other property from the Company
besides compensation as an officer,
nor a close relative of any of them.
He does not fall under any of thecases provided for in stock
exchange regulations as requiringexplanation on independence, andhe maintains independence such as
not being a major shareholder of theCompany. Accordingly, theCompany has designated Mr. Andoas an independent officer.
The Company expects him toprovide advice and suggestions inorder to oversee the Company’s
management in general and ensure
the legality and appropriateness ofdecision-making by the Board of
Directors based on his wealth ofexperience and wide insight fromhaving served as a corporate
manager for many years at acompany that has expanded its
business globally. Mr. Yamana isneither an executive of a fellow
subsidiary company of theCompany, an executive of a majorclient or supplier of the Company,or an attorney, accountant, or
consultant who receives a large
amount of monetary considerationor other property from the Company
besides compensation as an officer,
nor a close relative of any of them.
He does not fall under any of thecases provided for in stock
exchange regulations as requiringexplanation on independence, andhe maintains independence such as

NameMembershipof Audit &Supervisory
Committee

Designationas
Independent
Director

Supplementary
Explanation of
the Relationship○

External
Director,
MEDLEY, INC.

○―

Reiko Nagatsuma○

Hideo Watanabe- 10 -

Reasons of Appointment
not being a major shareholder of theCompany. Accordingly, theCompany has designated Mr.
Yamana as an independent officer.
The Company expects her toprovide useful advice on its
business transformation andexpansion of business areas for theGroup companies based on her
advanced insight into the fields ofIT and DX from having served at
global IT corporations for many
years, as well as her experience as acorporate manager. Ms. Nagatsuma
is neither an executive of a fellow
subsidiary company of theCompany, an executive of a majorclient or supplier of the Company,or an attorney, accountant, or
consultant who receives a large
amount of monetary considerationor other property from the Company
besides compensation as an officer,
nor a close relative of any of them.
She does not fall under any of thecases provided for in stock
exchange regulations as requiringexplanation on independence, andshe maintains independence such as
not being a major shareholder of theCompany. Accordingly, theCompany has designated Ms.
Nagatsuma as an independent
officer.
The Company expects him toprovide audit and supervisory
functions based on his wealth ofexperience and wide insight as acorporate manager over many years.
Mr. Watanabe is neither an
executive of a fellow subsidiarycompany of the Company, an
executive of a major client or
supplier of the Company, or an
attorney, accountant, or consultant
who receives a large amount ofmonetary consideration or otherproperty from the Company besides
compensation as an officer, nor aclose relative of any of them. He
does not fall under any of the cases
provided for in stock exchange
regulations as requiring explanation

Name

Membershipof Audit &Supervisory
Committee

Designationas
Independent
Director

Supplementary
Explanation of
the Relationship

○

○

―

○

○

―

Yukio Miyajima

Kenichi Kaneko- 11 -

Reasons of Appointment
on independence, and he maintains
independence such as not being amajor shareholder of the Company.
Accordingly, the Company has
designated Mr. Watanabe as anindependent officer.
The Company expects him toprovide audit and supervisory
functions based on his wealth ofexperience as a corporate manager
over many years as well as
experience and wide insight into adiverse range of operations including
business administration. Mr.
Miyajima is neither an executive of afellow subsidiary company of theCompany, an executive of a majorclient or supplier of the Company, oran attorney, accountant, or consultant
who receives a large amount ofmonetary consideration or otherproperty from the Company besides
compensation as an officer, nor aclose relative of any of them. He
does not fall under any of the cases
provided for in stock exchange
regulations as requiring explanation
on independence, and he maintains
independence such as not being amajor shareholder of the Company.
Accordingly, the Company has
designated Mr. Miyajima as anindependent officer.
The Company expects him toprovide supervision and oversight of
the Company’s management basedon his wealth of experience having
served at financial institutions formany years, as well as advanced
insight as a corporate manager. Mr.
Kaneko is neither an executive of afellow subsidiary company of theCompany, an executive of a majorclient or supplier of the Company, oran attorney, accountant, or consultant
who receives a large amount ofmonetary consideration or otherproperty from the Company besides
compensation as an officer, nor aclose relative of any of them. He
does not fall under any of the cases
provided for in stock exchange
regulations as requiring explanation

Membershipof Audit &Supervisory
Committee

Name○

Designationas
Independent
Director

Supplementary
Explanation of
the Relationshipon independence, and he maintains
independence such as not being amajor shareholder of the Company.
Accordingly, the Company has
designated Mr. Kaneko as anindependent officer.
The Company expects him toprovide supervision and oversight of
the Company’s management basedon his wealth of experience as acorporate manager and wide insightgained through his varied experiencein business for the improvement ofcorporate value over the medium tolong term. Mr. Maruyama is neither
an executive of a fellow subsidiarycompany of the Company, an
executive of a major client or
supplier of the Company, or an
attorney, accountant, or consultant
who receives a large amount ofmonetary consideration or otherproperty from the Company besides
compensation as an officer, nor aclose relative of any of them. He
does not fall under any of the cases
provided for in stock exchange
regulations as requiring explanation
on independence, and he maintains
independence such as not being amajor shareholder of the Company.
Accordingly, the Company has
designated Mr. Maruyama as anindependent officer.

OutsideDirector,
Yokogawa
Electric
Corporation○

Reasons of Appointment

Hisashi Maruyama[Audit & Supervisory Committee]
Committee’s Composition and Attributes of Chairperson
All Committee
Members
Audit&
Supervisory
Committee

Full-timeMembers4

Appointment of Directors and/or Staff to
Support the Audit & Supervisory Committee

Inside Directors
10OutsideDirectors

Chairperson
4Outside Director

Appointed

Matters Related to the Independence of Such Directors and/or Staff from Executive Directors
The Company has set up an Audit & Supervisory Committee Office so that the Audit & Supervisory
Committee and each Member of the Audit & Supervisory Committee can appropriately execute their duties,
and has appointed dedicated staff to assist in their duties.

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Our view on their independence is as follows:
1. With a view to ensuring the effectiveness of audits by the Audit & Supervisory Committee, theCompany appoints required personnel as support staff to enhance the relevant organization.
2. The support staff executes their duties under the command of the Audit & Supervisory Committee inorder to ensure independence.
3. Personnel reassignments, evaluations, and disciplinary actions on the support staff require priorconsent of the Audit & Supervisory Committee.

Cooperation among Audit & Supervisory Committee, Accounting Auditors and Internal Audit Departments
Each Director who is a Member of the Audit & Supervisory Committee, audits execution of duties byDirectors by exchanging opinions with the Representative Director and actively sharing information with theinternal audit division in addition to attending meetings of the Board of Directors. They also endeavor to work
closely with the Accounting Auditor by actively sharing information with them.

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[Voluntary Establishment of Nomination/Remuneration Committee]
Voluntary Establishment of Committee(s)Corresponding to Nomination Committee or Established
Remuneration Committee
Committee’s Name, Composition, and Attributes of Chairperson
Committee
Corresponding
toNomination Committee
Nomination and Compensation
Committee
3Committee
Corresponding
toRemuneration Committee
Nomination and Compensation
Committee
3

Full-time Members

00Inside Directors

11Outside Directors

22

Outside Experts

0

0

Other

0

0

Committee’s NameAll Committee Members

Chairperson

Inside Director

Inside Director

Supplementary Explanation
The Company has established a Nomination and Compensation Committee with a view to enhancing
transparency and objectivity of the nomination process for Director candidates and candidates for Directors
who are Members of the Audit & Supervisory Committee, as well as the decision-making process on Director
compensation. The committee is an advisory body to the Board of Directors.

[Independent Directors]
Number of Independent Directors

8

Matters relating to Independent Directors
The Company designates all Outside Directors who meet all of the criteria for independent officers stipulated
by stock exchanges as independent officers.

[Incentives]
Incentive Policies for Directors

Performance-linked Remuneration

Supplementary Explanation
In addition to annual performance-linked bonuses provided to Directors (excluding Outside Directors andDirectors who are Members of the Audit & Supervisory Committee) as short-term incentives, the Company
has introduced a performance-linked stock compensation plan linked to medium- to long-term businessperformance, upon resolution for approval at the Ordinary General Meeting of Shareholders held on June 24,
2022.

- 14 -

Recipients of Stock Options
Supplementary Explanation―[Director Remuneration]
DisclosureofIndividual

Directors’

Remuneration

No Individual Disclosure

Supplementary Explanation
In Annual Securities Reports, the Company discloses the number of recipients and amounts of compensationfor each category of Directors, Directors who are Members of the Audit & Supervisory Committee, andOutside Directors. Individual disclosure is provided in Annual Securities Reports for Directors who received
total compensation of 100 million yen or more on a consolidated basis.

Policy on Determining Remuneration Amounts
and Calculation Methods

Established

Disclosure of Policy on Determining Remuneration Amounts and Calculation Methods[Policy for Determining Content of Individual Compensation, etc., for Directors]
1. Basic Approach
Compensation for Directors shall be set at a level that motivates them to manage the Company with theaim of increasing corporate value not only in the short term but also in the medium to long term, and at
the same time allows the Company to secure a diverse and talented workforce. The level of compensation
shall be competitive in comparison with other companies in the same industry and other companies ofthe same size in other industries.
2. Specific Policies(1) Breakdown of compensation
Compensation for Directors (excluding Outside Directors and Directors who are Members of the
Audit & Supervisory Committee) shall consist of basic monthly compensation as fixedcompensation, an annual performance-linked compensation (both are monetary compensation), andstock-based compensation to be granted upon retirement based on points awarded for each period
covered by the medium-term management plan. Outside Directors and Directors who are Membersof the Audit & Supervisory Committee shall receive only basic monthly compensation, which is fixedcompensation.
(2) Limit on the total amount of monetary compensation and maximum number of shares for stock-based
compensation
The total amount of compensation for basic monthly compensation and annual performance-linked
compensation for Directors shall be determined within the limit of compensation approved by theGeneral Meeting of Shareholders, and the total number of shares of stock-based compensation shallbe determined within the maximum number of shares of stock-based compensation approved by theGeneral Meeting of Shareholders, respectively. Any change in the limit of the total amount ofcompensation or the maximum number of shares shall be approved by the Board of Directors andthe General Meeting of Shareholders.

- 15 -

(3) Determination of compensation for each Director
i. Determination of fixed compensation(a) The amount of fixed compensation for each Director (excluding Directors who are Membersof the Audit & Supervisory Committee) shall be determined by the Representative Director
based on the fixed basic executive compensation table (by position) within the limit of thetotal amount of compensation, taking into consideration the responsibilities and evaluation ofeach Director (excluding Directors who are Members of the Audit & Supervisory Committee).
(b) The fixed basic executive compensation table (by position) shall be determined each year by
the Representative Director after consulting the Nomination and Compensation Committee.
(c) The amount of fixed compensation for Directors who are Members of the Audit & Supervisory
Committee shall be determined by deliberation among the Members of the Audit &Supervisory Committee within the limit of the total amount of compensation, taking into
consideration whether the Director serves full-time or part-time, the duties assigned tohim/her, and other factors.
ii. Determination of performance-linked compensation(a) The amount of performance-linked compensation for each Director (excluding Outside
Directors and Directors who are Members of the Audit & Supervisory Committee) shall be
determined by the Representative Director based on the performance-linked executive
compensation table (by position), within the limit of the total amount of compensation, taking
into consideration the Company’s performance and Directors’ responsibilities and evaluation.
(b) The performance-linked executive compensation table (by position) shall be determined eachyear by the Representative Director after consultation with the Nomination and Compensation
Committee.
(c) Performance-linked compensation shall be paid once a year in the month following the monthin which the Ordinary General Meeting of Shareholders is held.
(d) The consolidated ordinary profit margin shall be used as an indicator of the Company’s
performance. The performance-linked executive compensation table (by position) shall set
absolute amounts for the ordinary profit margin of 2.0% or more but less than 10.0% in 1%
increments, and in 2% increments for the ordinary profit margin of 10.0% or more.
iii. Ratio of amount of fixed compensation to amount of performance-linked compensation
With regard to the ratio of the fixed compensation (annual basic compensation) amount to theperformance-linked compensation amount, assuming that the amount of the fixed compensationis 1, the performance-linked compensation amount shall be between 0 and 3.5, depending on the
consolidated ordinary profit margin.
iv. Determination of stock-based compensation
With respect to stock-based compensation, based on the Executive Stock Benefit Regulations,points to each Director (excluding Outside Directors and Directors who are Members of the Audit& Supervisory Committee) shall be granted in accordance with his/her position and the degree ofachievement of performance indicators based on the pre-determined medium-term three-year
plan, and then the number of the Company’s shares (a certain portion of which shall be cash
equivalent to the amount obtained by converting the Company’s shares at fair value)corresponding to the number of such points shall be granted to each Director at the time of his/her
retirement from office.
v. Percentage of compensation amount by type
The percentage of the amount of each type of compensation within the total amount ofcompensation will vary depending on the business performance and stock price, but shallgenerally be as follows:
Monetary compensation (fixed compensation and performance-linked compensation): 75%
Stock-based Compensation: 25%
vi. Delegation for determination of compensation for individual Directors(a) Person to be delegated: Kentaro Ogawa, Representative Director, Chairman, President & CEO(b) Content of authority to be delegated: Determination of specific amounts of fixed compensationand performance-linked compensation(This does not include matters related to stock-based compensation.)(c) Measures to ensure that the delegated authority is properly exercised: The fixed basic
executive compensation table and the performance-linked executive compensation table,- 16 -

which will form the basis for calculating the amount of compensation, shall be submitted to
the Nomination and Compensation Committee for consultation, and the specific amount shallbe determined in accordance with the basic policy on compensation for Directors determinedby the Board of Directors.

[Supporting System for Outside Directors]
Inside Directors and others share information with part-time Outside Directors on an ongoing basis, andagenda and documents for meetings of the Board of Directors are sent to Outside Directors in advance. In
addition, the Audit & Supervisory Committee Office has been established to develop a structure for assistingOutside Directors who are Members of the Audit & Supervisory Committee in their audit duties.

2. Matters on Functions of Business Execution, Auditing, Oversight, Nomination and Remuneration
Decisions (Overview of Current Corporate Governance System) Updated
1. Board of Directors
As of June 27, 2024, the Board of Directors of the Company is comprised of nine Directors (excluding
Directors who are Members of the Audit & Supervisory Committee) and four Directors who areMembers of the Audit & Supervisory Committee for a total of 13 members, including eight Outside
Directors. The chairperson of the Board is Kentaro Ogawa, Representative Director, Chairman, President& CEO. Meetings of the Board of Directors are generally held once a month to deliberate and decide on
matters provided for in laws and regulations, the Articles of Incorporation, the Board of Directors
Regulations, and other relevant regulations, as well as to monitor and supervise the state of execution ofduties by Directors.
2. Audit & Supervisory Committee
As of June 27, 2024, the Audit & Supervisory Committee of the Company is comprised of four Directors
who are Members of the Audit & Supervisory Committee, all of whom are Outside Directors. The
chairperson of the Committee is Hideo Watanabe, Outside Director (full-time Member of the Audit &Supervisory Committee).
The Audit & Supervisory Committee, as a body independent from the Board of Directors, conducts
audits on execution of duties by Directors, development and operation of the Group’s internal control
systems, and other matters from the perspective of legality and properness. Furthermore, the committee
provides a supervisory function on the decision-making process of the Board of Directors and state ofbusiness execution by Directors through attendance at meetings of the Board of Directors and otherimportant meetings, as well as reviews of important documents such as approval documents.
3. Accounting Auditor
The Company has executed an audit contract with PricewaterhouseCoopers Japan LLC, the Accounting
Auditor, which conducts accounting audits. Shigeru Takahama and Kentaro Shimizu are the two certified
public accountants who engaged in the accounting audit, and they both belong toPricewaterhouseCoopers Japan LLC. Assistants for the accounting audit duties comprise four CPAs and21 others.
4. Nomination and Compensation Committee
The Company has established a Nomination and Compensation Committee as an advisory body to theBoard of Directors, with a view to enhancing transparency and objectivity of the nomination process for
Director candidates and candidates for Directors who are Members of the Audit & Supervisory
Committee, as well as the decision-making process on Director compensation. The Nomination andCompensation Committee is comprised of three members, namely Shinya Nonoshita, Managing
Executive Director (chairperson), Takaharu Ando, Outside Director, and Yukio Miyajima, Outside
Director (Member of the Audit & Supervisory Committee).

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5. Investment Advisory Committee
The Company has established an Investment Advisory Committee as an advisory body to the Board of
Directors, for the purpose of deliberating on investment projects such as M&As and share offerings. The
Investment Advisory Committee is comprised of eight members, including Kiyohiko Niwa, Executive
Officer, Senior General Manager of Group Finance and Accounting Division (chairperson), Yohei
Ogawa, Managing Executive Director, Kazumasa Ogawa, Director, and others.
6. Committee of Total Risk Management and Compliance
The Company has established a Committee of Total Risk Management and Compliance as an advisory
body to the Board of Directors to oversee risk management and legal compliance initiatives of theCompany and the Group across organizations. The Committee of Total Risk Management andCompliance generally meets every two months to check and monitor the state of risk management andlegal compliance of the Company and the Group, and to provide instructions for improvements. The
state of its activities is periodically reported to the Board of Directors and the Audit & Supervisory
Committee. The Committee of Total Risk Management and Compliance is comprised of six members,
including Shinya Nonoshita, Managing Executive Director (chairperson), Makoto Hirano, Director, andExecutive Officers in charge of relevant divisions.
7. Sustainability Committee
The Company has established a Sustainability Committee as an advisory body to the Board of Directors
to promote sustainability management based on its management vision and the “Zensho Group’s
Approach to Sustainability.” The Sustainability Committee is comprised of nine members, including
Yohei Ogawa, Managing Executive Director (chairperson), Makoto Hirano, Director, and Executive
Officers in charge of relevant divisions.
8. Outline of liability limitation agreements
Based on Article 427, Paragraph 1 of the Companies Act, the Company has concluded agreements tolimit liabilities for damages of Article 423, Paragraph 1 of the same Act with Outside Directors(excluding full-time Directors). The limit of liabilities for damages under said agreements are 10 million
yen or the amount stipulated by laws and regulations, whichever is greater, for Outside Directors(excluding Directors who are Members of the Audit & Supervisory Committee) and 5 million yen or theamount stipulated by laws and regulations, whichever is greater, for Outside Directors who are Membersof the Audit & Supervisory Committee.

3. Reasons for Adoption of Current Corporate Governance System
In order to carry out appropriate corporate governance, participation by multiple outside officers with a variety
of expertise is essential. The Company believes the current organizational structure is appropriate for ensuring
full understanding and realization of the Company’s mission of “providing safe and delicious food ataffordable prices to people throughout the world.”- 18 -

III. Implementation of Measures for Shareholders and Other Stakeholders
1. Measures to Vitalize the General Shareholder Meetings and Smooth Exercise of Voting Rights
Early Notification of General
Shareholder Meeting
Scheduling AGMs Avoiding
the Peak Day
Allowing Electronic Exerciseof Voting Rights
Participation in Electronic
Voting Platform
Providing Convocation Noticein English
Other

Supplementary Explanations
The Company generally sends notices 21 days prior to the day of the meeting,and submits them to the Tokyo Stock Exchange via TDnet and discloses themon its website at least 28 days before the meeting.
The Company strives to schedule General Meetings of Shareholders avoiding
peak days so that shareholders can more easily attend meetings.
Shareholders who are unable to attend a General Meeting of Shareholders can
exercise their voting rights by mail or via the Internet.
The Company participates in an electronic voting platform.
The Company provides disclosure on its website and TDnet.
President himself gives explanations on important managerial matters.

2. IR Activities
Supplementary Explanations
Regular Investor Briefings forAnalysts and Institutional
Investors
Posting of IR Materials on
WebsiteEstablishment of Department
and/or Manager in Charge ofIR

The Company holds briefings for analysts andinstitutional investors upon full-year earnings releaseand second quarter earnings release.
The Company publishes materials including CEO’s
Message, Financial Results, Business Reports, andtimely disclosure documents stipulated by the Tokyo
Stock Exchange.
The Company has set up a department in charge of IR
and assigned employees within the Group Finance andAccounting Division.

Explanation by the
RepresentativeNone

3. Measures to Ensure Due Respect for Stakeholders Updated
Stipulation of Internal Rules
for Respecting the Position of
Stakeholders
ImplementationofEnvironmental Activities, CSR
Activities etc.

Supplementary Explanations
The Company stipulates its regulations on relationships with its stakeholders
in the “Basic Policy on Corporate Governance,” which is disclosed on the
Company’s website.
The Company endeavors to make social contribution through fair trade
programs, disaster relief activities in Japan and overseas, and other initiatives.

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IV. Matters Related to the Internal Control System
1. Basic Views on Internal Control System and the Progress of System Development
1. Systems to ensure that the execution of duties by Directors and employees complies with laws,
regulations, and the Articles of Incorporation(1) The “Zensho Group Charter” shall be established to ensure that all officers and employees comply
with laws, regulations, the Articles of Incorporation, and internal rules.
(2) Each Director and Executive Officer in charge of business operations shall analyze compliance risks
in the business unit he/she is in charge of and implement countermeasures against such risks.
(3) The “Committee of Total Risk Management and Compliance” shall oversee the Group’s complianceinitiatives across the Group and report the results of its deliberations to the Board of Directors andthe Audit & Supervisory Committee. The “Zensho Group Hotline” shall be established for employees
to provide information on compliance issues of the Group.
(4) In order to grasp the status of business operations in business activities in general and to ensure thelegality and soundness of such activities, audits by the internal audit division shall be conducted
continuously.
2. Regulations and other systems for managing the risk of loss
(1) The Company shall establish the “Group Risk Management Regulations,” comprehensively andappropriately recognize various risks within the Group, select risks to be managed, appoint a divisionin charge of management, and develop and enhance the risk management system. In addition, fullyrecognizing that unexpected risks may occur, the Board of Directors or the Representative Director
shall promptly select a division in charge of management and respond promptly and appropriately to
any new significant risk.
(2) The “Committee of Total Risk Management and Compliance” shall be established tocomprehensively manage various risks within the Group in accordance with the regulations, and its
effectiveness shall be ensured by inspecting the implementation status of risk countermeasures by thedivision in charge of management.
(3) For risks related to “food safety and security,” “compliance,” and “information security,” and otherselected risks, the division in charge of management shall formulate corresponding countermeasures.
In the event that risk materializes, the division in charge of management shall take prompt andappropriate action, report the results to the “Committee of Total Risk Management and Compliance,”
and report to the Board of Directors as appropriate for risks that may have a significant impact onmanagement, and receive necessary instructions.
3. System for storing and managing information related to the execution of duties by Directors(1) The Company shall store and manage information related to the execution of duties by Directors
appropriately in accordance with the “Board of Directors Regulations” and “Document Management
Regulations.”(2) Directors shall confirm that the system for storage, management, and preservation of suchinformation is properly maintained.
4. System to ensure the efficient execution of duties by Directors(1) The Company shall formulate a medium-term management plan and an annual management plan inorder to clarify goals to be achieved by the Company, and shall thoroughly manage daily, monthly
and quarterly operations to clarify the progress of the goals so that prompt judgment and decision canbe made.
(2) In addition to simplifying the decision-making process to speed up the decision-making, theCompany shall make executive decisions on matters to be decided by the President that may have asignificant impact on the management of the Company and the Group based on discussions with the
Director in charge and Executive Officers, and report these decisions to the Board of Directors as
appropriate.

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5. System to ensure the appropriateness of operations of the corporate group consisting of the Company
and its subsidiaries(1) The “Zensho Group Charter” shall be the code of conduct for all officers and employees of theCompany and its subsidiaries to act in compliance with laws and regulations and the Articles ofIncorporation.
(2) The Company, as a holding company, shall develop a system to ensure the appropriateness of business
operations from the perspective of the entire Zensho Group, and shall manage Group companies
according to their conditions based on the “Group Company Management Regulations.” In addition,
the Company’s group company administration division shall serve as the contact point and receive
reports on the status of the system from subsidiaries on a regular or as-needed basis.
(3) The Company shall dispatch officers and employees to the subsidiaries, grasp the status of thesubsidiaries’ business execution, and confirm the effectiveness of their business activities.
(4) The internal audit division shall audit the Group companies on a regular or as-needed basis and report
the status of the audit to the Representative Director of the Company in a timely manner.
6. System to ensure the reliability of financial reporting(1) Recognizing that ensuring the reliability of financial reporting is essential for maintaining andimproving the credibility of the Group’s activities, the importance of internal control activities related
to financial reporting shall be thoroughly understood throughout the Zensho Group.
(2) The “Assessment Plan for Internal Control over Financial Reporting” shall be prepared for each fiscal
year, and the entire Group shall work together to improve internal control over financial reporting on
a consolidated basis.
(3) With regard to the maintenance and operation status of internal control over financial reporting, thedivision in charge of internal control evaluation shall verify the appropriateness of business
operations to ensure the reliability of financial reporting of the entire Group.
7. Matters concerning Directors and employees who are to assist the Audit & Supervisory Committee inits duties (hereinafter the “Assistant Employees, etc.”) and matters concerning the independence of theAssistant Employees, etc., from other Directors and the securing of the effectiveness of instructions(1) From the viewpoint of ensuring the effectiveness of audits by the Audit & Supervisory Committee,
the Company shall appoint the necessary personnel as the Assistant Employees, etc., and enhance thesystem.
(2) From the viewpoint of ensuring independence, the Assistant Employees, etc., shall perform theirduties under the direction of the Audit & Supervisory Committee.
(3) The prior consent of the Audit & Supervisory Committee is required for the transfer of, evaluationof, and disciplinary action against the Assistant Employees, etc.
8. System for Directors (excluding Directors who are Members of the Audit & Supervisory Committee)
and employees to report to the Audit & Supervisory Committee and other systems related to reportingto the Audit & Supervisory Committee(1) Directors (excluding Directors who are Members of the Audit & Supervisory Committee) shallpromptly report to the Audit & Supervisory Committee on matters that have a material impact on the
Company and the Group, the status of internal audits, the status of reporting to the “Zensho Group
Hotline,” etc.
(2) Any officer or employee of the Company or its subsidiaries who discovers any matter that may
materially affect the Company or the Group may report directly to the Audit & Supervisory
Committee, and such reports shall be handled in accordance with the “Group Internal Report
Regulations.” The Company shall ensure that no person who makes such report shall be subjected toany disadvantageous treatment because of such report.
(3) The Audit & Supervisory Committee shall share information and improve efficiency through mutual
disclosure of audit plans, audit results, etc., with the internal audit division.

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9. Other systems to ensure that audits by the Audit & Supervisory Committee are conducted effectively(1) The Representative Director shall meet regularly with the Audit & Supervisory Committee toexchange opinions on issues to be addressed by the Company, the state of the environment for theaudits of the Audit & Supervisory Committee, and important auditing issues.
(2) If the Audit & Supervisory Committee independently receives advice from professional attorneys,accountants, or other experts on the performance of its duties, the Audit & Supervisory Committee
may charge the Company for expenses incurred thereby.
(3) The Audit & Supervisory Committee may, when it deems necessary, request reports from Directors(excluding Directors who are Members of the Audit & Supervisory Committee) and employees,
attend important meetings, and inspect documents.

2. Basic Views on Eliminating Anti-Social Forces
1. Basic policy on elimination of antisocial forces
The Company shall have no relationship with antisocial forces. The Company shall take a resolute
attitude toward any unreasonable demands from antisocial forces, and shall not provide any monetaryor other economic benefits. Furthermore, the Company will ensure that all Group companies are fully
aware of this policy.
2. Status of maintenance for elimination of antisocial forces(1) The Company has established the “Zensho Group Charter” to promote corporate ethics, and has alsoestablished the “Group Compliance Regulations” and “Compliance Action Guidelines” to realize
compliance, thereby providing specific guidelines for the “elimination of antisocial forces.”(2) The Company shall make the “Zensho Group Charter,” “Group Compliance Regulations,” and“Compliance Action Guidelines” known and thoroughly understood by all employees throughtraining at the time of hiring or periodic training.
(3) In addition, to deal with antisocial forces, the “Committee of Total Risk Management andCompliance” has been organized to ensure that no individual or department is left alone, and a system
has been established to deal with such forces in cooperation with the police, attorneys, and otherexternal specialized agencies.

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V. Other
1. Adoption of Anti-Takeover Measures
Adoption of Anti-Takeover Measures

Not Adopted

Supplementary Explanation―

2. Other Matters Concerning to Corporate Governance System<Internal system for timely disclosure of corporate information>
1. At the Company, the Group Finance and Accounting Division discloses corporate information(decisions, facts occurred, and earnings information) in a timely manner to the Tokyo Stock Exchange
through TDnet, upon reviews by relevant departments and the Representative Director.
2. Decisions and facts occurred at the Company and its Group companies are reported to an entity
responsible for handling of information (Executive Officer and Senior General Manager of the Group
General Affairs Division) by a person in charge of the relevant department or person responsible for
information administration of a Group company. Upon receiving such a report, the entity responsible forhandling of information discusses legality, accuracy, and officiality with the Group Finance andAccounting Division, the Public Relations Office, and other relevant departments in light of the rules ofstock exchanges on which the Company stock is listed, the Financial Instruments and Exchange Act, theCompanies Act, other applicable laws and regulations, rules, guidelines, etc., and then instructs theGroup Finance and Accounting Division to provide a timely disclosure.
3. Earnings information is prepared by the Group Finance and Accounting Division and reported to theRepresentative Director. Timely disclosure is provided upon approval of the Board of Directors.

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