March 29, 2023
Sumitomo Mitsui Banking Corporation
Sustainability Linked Loan for Kao Corporation
Sumitomo Mitsui Banking Corporation ("SMBC", President and CEO: Makoto Takashima) has signed
an agreement for a sustainability linked loan ("This Loan") with Kao Corporation ("Kao", President andCEO: Yoshihiro Hasebe).
The objective of sustainability linked loans is to promote and support environmentally and sociallybeneficial economic activities and growth by linking corporate loan terms with a client’s performanceagainst sustainability performance targets (“SPTs”) consistent with a client’s sustainability strategy.
The SPTs set under This Loan adopted climate change, forests and water security assessment scores
published by CDP (*1). As an incentive to achieve the SPTs, the interest rates of This Loan will be
adjusted depending upon the achievement of these targets. The SPTs are detailed below;(SPTs)
A score over two or more categories on CDP climate change, forests and water security assessment scoresWith the corporate purpose “To realize a Kirei World in which all life lives in harmony”, Kao Groupestablished its ESG strategy, the Kirei Lifestyle Plan in 2019 (“Kirei” means living a beautiful life insideand out). Kao Group’s Mid-term Plan 2025 (K25), developed in 2021, details the company’s objective tobecome a company essential to a sustainable society, with its vision of “protecting future lives” and“sustainability as the only path.” Kao addresses climate change challenges across the value chain. To
pursue its decarbonization, Kao has drawn up a roadmap to achieve carbon zero by 2040 and carbon
negative by 2050. In the forestry sector, Kao has been promoting a support program for palm-oilsmallholders to contribute to preventing deforestation. Regarding water security, Kao has been working
with stakeholders to promote water-saving activities and to pursue business matching opportunities. By
disclosing to stakeholders its policies and actions to its whole value chain and its business strategies
incorporating the risks and opportunities in relation to climate, forests and water, high scores can be
maintained while at the same time leading to the accomplishment of its long-term vision.
SMBC assessed that This Loan aligns with the “Sustainability Linked Loan Principles” (revised inFebruary 2023) published by Loan Market Association (LMA), Loan Syndications and Trading
Association (LSTA) and Asia Pacific Loan Market Association (APLMA), and “Green Loan andSustainability Linked Loan Guideline 2022” published by the Ministry of the Environment of Japan.
On July 27, 2021, SMBC Group published "SMBC Group GREEN Innovator" and aims to enhance ourservices and products to realize a sustainable society together with our clients. In addition, SMBC willfurther contribute to achieving sustainable society by providing solutions and engaging in dialogue forour clients’ sustainable corporate management.

1[Outline of This Loan]
Date of Contract: March 27, 2023
Date of Draw-down: March 29, 2023
Sustainability Coordinator (*2): SMBC
Contract Period: 4 years(*1)
CDP: An international not-for-profit organization established in London in 2000. CDP provides global
disclosure system to companies and governments in such fields as climate change, water security anddeforestation risks, and the disclosed data and information is utilized by investors, companies andgovernments.
(*2)
Sustainability Coordinator: An entity whose role is to provide facilitation and support to the borrower toformulate sustainability linked loan, including setting the SPTs.
(Reference)
Kao Corporation news release
https://www.kao.com/global/en/news/
Kao Corporation sustainability website
https://www.kao.com/global/en/sustainability/[Contact Information]
Sustainable Solutions Department
TEL: +81-3-4333-6964
This announcement is not intended as a recommendation to invest or solicit.

2