[This document is an English translation prepared for reference purpose only. Should there by any inconsistency between the translation and the original Japanese text,
the latter shall prevail.]

Overview of the JT Group Sustainability StrategyJT Group
PurposeFulfilling Moments, Enriching LifeJT Group
Materiality

JT Group
Sustainability
Targets1

JT Group Sustainability Targets (1/7)
Materiality

Target items

Targets
New

Biodiversity impact assessment

Each of the JT Group businesses will perform assessments toevaluate its impact and dependency on ecosystem, including
biodiversity aspects. Impact assessments of our tobacco business will
be performed by 2024, and our pharmaceutical and processed foodbusiness by 2025.

Emissions reduction

The JT Group will reduce its emissions and commits to be Carbon
Neutral for its own operations by 2030 and achieve Net-Zero
Greenhouse Gas emissions across its entire value chain by 2050.
By 2030, we commit to reduce absolute Scope 1 and 2 GHG
emissions by 47% in line with a 1.5℃ reduction pathway
against a 2019 base year
By 2030, we commit to reduce absolute Scope 3 GHG emissions
associated with purchased goods and services by 28% against a
2019 base year
Our tobacco business will be Carbon Neutral for its own
operations by 2030 and will achieve Net Zero greenhouse gas
emissions across its entire value chain by 2050. In support ofthis, the tobacco business will reduce emissions from its own
operations by 47% and emissions associated with leaf and nontobacco materials by 28%, against a 2019 base year
Our processed food business will promote energy-saving
initiatives and introduce renewable energy to contribute to theGroupʼs emissions reduction targets and to improve impact onenvironmentRevised

Renewable energy

By 2050, the JT Group will transition all of our energy use to zerocarbon energy by 2050.
We will increase the proportion of renewable electricity that we
use to 50% by 2030 and 100% by 2050. In our tobacco
business, 50% by 2025 and 100% by 2040
2

JT Group Sustainability Targets (2/7)
Materiality

Target items

Targets
RevisedProtecting water

RevisedEnhancing biodiversity– No deforestation, no conversion

The JT Group will engage in responsible water management and will
pursue the following:
We will monitor the Groupʼs use of water in areas with waterscarcity. Our tobacco business will reduce water withdrawal in
its own operations by 33% by 2030 against a 2019 base year.
Our processed food business will pursue efficient water use andwastewater quality management to preserve water stewardshipas a member of the local community
We will monitor water recycling at the Groupʼs production
facilities
We will prevent water pollution based on the Groupʼs standards,
which should be equal to or stricter than local legal requirements
Our tobacco business will have 100% of its eligible production
facilities certified against the Alliance for Water Stewardshipstandard by 2030
With a view to enhancing biodiversity, the JT Group will contribute
further to preserving forestry by pursuing the following in our tobacco
business supply chain:
Replace all wood from natural forests used in the tobacco curing
process of its directly contracted leaf growers with renewable
fuel sources by 2030
No deforestation of natural forests in the operations and supply
chains for tobacco leaf, paper and pulp-based materials by 2025
and in our entire supply chain by 2030
No conversion of natural ecosystem in the tobacco businessʼ
own operations and supply chains for tobacco, paper and pulpbased materials in high conservation value areas by 2025 andall natural lands by 2030
Zero net deforestation of managed natural forests in the entire
tobacco business supply chain by 2030

3

JT Group Sustainability Targets (3/7)
Materiality

Target items

Targets
RevisedWaste reduction

The JT Group will further reduce the environmental impacts of waste
associated with its processes and products.
Zero factory waste to landfill by 2030 in our tobacco businessOur tobacco business will engage trade and consumers on
responsible disposal of devices through take-back schemes for
Ploom, and through anti-littering campaigns for consumables
Our processed food business will pursue waste reduction tocontribute to a circular society and will aim to recycle 95% of all
waste from its Japanese offices (excluding waste heat recovery)

Designing for circularity– packaging, product and device

The JT Group will reduce our packaging (including plastic) and ensurethat the remaining is 88% reusable or recyclable by 2025, rising to
100% by 2030.
Our tobacco business will reduce packaging and achieve 85%
recyclability by 2025, rising to 100% by 2030
In total, recycled content will account for 20% of our tobacco
business packaging by 2025. The tobacco business will seek tofurther increase the use of recycled materials in its packaging
In our tobacco business, plastic in our packaging mix is only 7%by weight. The tobacco business will aim to further reduce theuse of virgin plastic in its packaging. We are also working todevelop more sustainable filter alternatives
Our tobacco business will take a phased approach in embedding
learnings in its circular device development globally, byachieving battery removability & replaceability for 100% of its
RRP* devices shipped to the EU by 2027
Our processed food business will reduce packaging weight andutilize renewable plant-based resources to reduce environmental
impact of its products

Revised*RRP(Reduced-Risk Products): Products with the potential to reduce the risks associated with smoking
4

JT Group Sustainability Targets (4/7)
Materiality

Target items

Targets
New

Sustainable agriculture

Reduced-Risk Products

RevisedOur tobacco business will complete the elimination of Criterion 1
Highly Hazardous Pesticides (HHPs) from its direct tobacco leaf
supply chain in 2024 and eliminate the use of all HHPs by 2040.
100% of our directly-contracted growers will have adopted Good
Agricultural Practices (GAP) Protocol of our tobacco business by 2030.
Our tobacco business will make its RRP* available in an increasing
number of countries worldwide.

NewIn our tobacco business, we will ensure that reduced risk claims aresubstantiated and that we are transparent about the risks ofour products.

NewYouth Access Prevention (YAP)In our tobacco business, we will continue deliver training on YAP toour marketing and sales force. We will also continue to work with ourtrading partners to ensure compliance with its YAP pillars.

Creating first-in-class drugs

In our pharmaceutical business, we will continue our efforts andinvestments in research and development activities for innovative
drugs in specific therapeutic areas.

Transparency in Reduced Risk
Science

RevisedFood inclusion

In our processed food business, we will be aware of the diversifying
values and interests of our consumers. Most of all so that ourconsumers can enjoy delicious food, we will not only exclude certain
raw materials, but also develop and provide high-value-addedproducts, such as allergy-friendly products, products that do not use
ingredients derived from animals, or products that are healthconscious and satisfy other preferences.

*RRP(Reduced-Risk Products): Products with the potential to reduce the risks associated with smoking
5

JT Group Sustainability Targets (5/7)
Materiality

Target items

Targets
Diversity in gender, nationality, individual experiences, expertise andvalues forms the foundation of a companyʻs success and contributes toreal sustainable growth. We will promote initiatives to enhance diversity
and promote inclusion. Furthermore, as part of our efforts to empower
women, our Group target for womenʼs representation in managerial
positions is to reach 30% by 2030.
Target for our tobacco business is to reach and maintain at least
1/3 of managerial positions filled by women
Our processed food business will promote organizational building
for our diverse human resources to thrive and take active roles. In
this context, the processed food business will work to empower
women, with a view to contributing to the JT Group's goal for
women in leadership

Diversity, equity & inclusion

NewWe will work to retain and attract our people from each location orbusiness to build a continuous pipeline of talents to lead and manage ourbusiness. Our tobacco business will aim at achieving yearly Global Top
Employer certification.

New

While working at the JT Group, our employees will go through various
stages in life. We will strive to improve our system so that the career
path and work-life balance desired by each person is realized. We willalso encourage and monitor rates for parental leave, so that we canprovide support to our employees in balancing work and family life.

Revised

We will prioritize the health and safety of our employees by proactively
monitoring physical and mental health with the goal of achieving zero
workplace injuries.
Our tobacco business will decrease the injury rate to 0.1 by 2030
in line with its vision of Zero workplace injuries
Our processed food business will aim for injury rates to or below
0.63 by 2030, with a view to achieving Zero workplace injuries

Talent attraction

Attractive working conditions

Health and safety

Development support

New

We will create an ecosystem in which each JT Group employee canconsider their own careers and make career choices. We will also provide
learning opportunities tailored for each employee to proactively support
their growth and the growth of our organization.
6

JT Group Sustainability Targets (6/7)
Materiality

Target items

Targets
To promote collaborations within the Group across regions and functions,
we will provide opportunities for collaborations while also proactively
engage in collaborating with external parties to contribute to thedevelopment of inclusive and sustainable communities. Between 2015
and 2030, our employees will contribute 300,000 volunteering hours.

Internal and external collaboration

RevisedSupplier screening andsupply chain due diligence

Grower living incomeNew

The JT Group will screen all key suppliers against ESG criteria.
Our tobacco business will screen 100% of its key suppliers against
environmental, social and governance criteria by 2023. The tobacco
business will also implement Agricultural Labor Practices (ALP) program
in all leaf-sourcing countries by 2025.
Furthermore, by 2025, our tobacco business will proactively manage ESG
risks with all its critical suppliers, to ensure a sustainable business
continuity. By 2028, all tobacco supplying entities will achieve a Supply
Chain Due Diligence maturity score >90%, verified by an independent
third party.
By 2025, we will complete supply chain due diligence of all key suppliers
for our pharmaceutical business and processed food business and will
also perform regular due diligence thereafter.
Through the JT Group Supplier Code of Conduct and supplierquestionnaires, our processed food business will work jointly with, shareits values and communicate closely with its suppliers to realize asustainable supply chain.

In our tobacco business, the ambition is for all our leaf growers toachieve a living income. By 2025, we will implement our Living Income
Calculator in 100% of our direct tobacco leaf supply chain origins.

7

JT Group Sustainability Targets (7/7)
Materiality

Target items

Targets
RevisedHuman rights in grower communities

NewBy 2025, our tobacco business will monitor 100% of farms in its direct
tobacco leaf supply chain origins on human rights including child labor,
and annually disclose related KPIs, prevention and remediation actions.

Grievance mechanisms

By 2027, our tobacco business will provide access to remedy via safe,
accessible and effective grievance mechanisms for 100% of growers andfarm workers in its direct tobacco leaf supply chain origins.

Community investment

Between 2015 and 2030 we will invest US$600 million to help makecommunities inclusive and resilient, with our employees contributing
300,000 volunteering hours.

Internal control

Our tobacco business will always protect its ability to participate in publicpolicy debate with the aim to achieve balanced regulation that meets
societal concern and support business growth. The tobacco business will
also engage in dialogue with law enforcement agencies, with the goal toexchange intelligence regarding illegal tobacco products, in order tosupport the reduction of these products.
In our pharmaceutical business, to develop talent and foster employeesʼ
ethical awareness and sense of responsibility towards saving patients,
we will continue to learn more about patientsʼ needs by engaging in
dialogue with medical experts through our internal educational activity“For the Patients Project.” We will also conduct, among others, regulartraining programs for our medical representatives to provide medical
professionals with latest, appropriate information on pharmaceuticalproducts.
Our processed food business will promote food safety management incompliance with global food safety standards to develop the highest levelof food safety. While working on enforcing food safety and quality
assurance, the processed food business will also enhance the way it
communicates with consumers to provide them with safe, secure andhigh-quality products.
As of 27 June 20248