CONVOCATION NOTICE OF
THE 151ST ORDINARY GENERAL MEETING OF SHAREHOLDERS
June 3, 2021
Sumitomo Electric Industries, Ltd.
On June 3, 2021, Sumitomo Electric Industries, Ltd. (the “Company”) has sent a notice
convening the 151st Ordinary General Meeting of Shareholders (the “Notice”) to its
shareholders on record as of March 31, 2021. This document only provides translationsof information contained in the Japanese original text of the Notice (except nonconsolidated financial statements, independent auditor's reports, the report of Audit &Supervisory Board, instructions on exercise of voting rights and map) and of the notes toconsolidated financial statements (the “Notes”) disclosed on the internet in relation to the
Convocation notice of the 151st Ordinary General Meeting of Shareholders, solely for the
purpose of identifying the items of information contained in the Notice and the Notes forreference. The Company does not represent or warrant that the information provided on
this document (the “Information”) constitutes a summary of the Notice and the Notes orprovides a complete and accurate record of the material information in the Notice and theNotes. No warranty is given to any user of the Information as to its accuracy orcompleteness or timeliness. In the event of a dispute or difference as to meaning or intent
of the Information and the Japanese original text of the Notice and the Notes, the Japaneseoriginal text of the Notice and the Notes shall prevail. In order to accurately andcompletely understand the information contained in the Notice and the Notes, it isnecessary to read the complete Japanese original text thereof. The shareholders of theCompany are therefore requested to refer to the complete text of the Notice. The original
Japanese text of the Notice and the Notes should be available on our Japanese Web site(https://sei.co.jp/ir/meeting/).
Neither the provision of the Information nor any part of the Information shall be deemed to
be an offer to purchase or sell, or a solicitation of an offer to purchase or sell, any
securities, nor shall it be deemed a recommendation for or an endorsement of investmentby the Company. Neither the Company nor any of its directors, officers, employees,
agents, affiliates and assigns shall be liable to any person for any losses, damages, costs
or expenses of whatever nature arising out of, or in any way related to, any errors to,delays in, ambiguities of, omissions from or alterations to, the Information or for any
reliance by such person on any part of the Information.

(Translation)
Securities Code: 5802
June 3, 2021
To the Shareholders
Sumitomo Electric Industries, Ltd.
5-33, Kitahama 4-chome
Chuo-ku, Osaka City
Represented by: Osamu Inoue
President

CONVOCATION NOTICE OF
THE 151ST ORDINARY GENERAL MEETING OF SHAREHOLDERS

We are pleased to hereby inform you that the 151st Ordinary General Meeting of
Shareholders (the “Meeting”) will be held as set forth below.
In addition to attending the Meeting, you have an option to exercise your voting rights
in writing or by electromagnetic means (the Internet, etc.). We cordially request that you
exercise your voting rights (in doing so, please follow the “Instructions Regarding Voting” set
forth on page 3 [of the Japanese original text]) by 5:15 p.m. of June 24, 2021 (Thursday),after examining the Reference Documents regarding the Ordinary General Meeting of
Shareholders set out below.

1.

Date:

June 25, 2021 (Friday) at 10:00 a.m.

2.

Place:“The Grand Ballroom” 2nd floor
The Ritz-Carlton, Osaka
5-25, Umeda 2-chome, Kita-ku, Osaka City

3.

Purposes of the Meeting:

Matters to be reported
1.

Reporting on the Business Report, the Consolidated Financial Statements andthe results of the examination of the Consolidated Financial Statements by the
Accounting Auditor and the Audit & Supervisory Board for the 151st fiscal year
(from April 1, 2020 to March 31, 2021)

2.

Reporting on the Non-Consolidated Financial Statements for the 151st fiscal
year (from April 1, 2020 to March 31, 2021)

Matters to be resolvedFirst item:

Disposition of surplus

Second item:

Appointment of fifteen (15) Directors due to the expiration of the termof office of all of the current Directors

Third item:

Appointment of one (1) Audit & Supervisory Board Member

Fourth item:

Payment of bonuses to the Directors

Fifth item:

Revision of the amount of remuneration of Directors

Sixth item:

Revision of the amount of remuneration of Audit & Supervisory Board
Members*

Substitutions are allowed only when the proxy is the Company’s shareholder withvoting rights, and one person for each shareholder. (The proxy must bring not only
the “Voting Instruction Form” of the shareholder but also a certification for his or her
authority.)*

The notes to the consolidated financial statements and the notes to non-consolidated
financial statements, which are a part of the documents that should be provided
together with this Notice, are disclosed through postings on our website(https://sei.co.jp/ir/) pursuant to laws and regulations and the provision of Article 15 of
the Articles of Incorporation, and are therefore not described in the attachment to thisNotice. Accordingly, the consolidated financial statements and the non-consolidated
financial statements attached to this Notice are part of the consolidated financial
statements and the non-consolidated financial statements that were subject to audit by
the Audit & Supervisory Board Members for the purpose of an auditors’ report, as wellas an audit by the Accounting Auditor for the purpose of an accounting auditor’s report.

*

When the reference documents regarding the ordinary general meeting ofshareholders, the business report, the consolidated financial statements or the nonconsolidated financial statements need modification by the day before the Meeting, we
will notify the shareholders in writing by mail or by notice on our website(https://sei.co.jp/ir/).

(Translation)
REFERENCE DOCUMENTS
REGARDING THE ORDINARY GENERAL MEETING OF SHAREHOLDERS
Agendas and Reference Information
First item:

Disposition of surplus

Based on maintenance of stable dividends, the Company has the basic policy of making
distribution of profits to shareholders after taking into consideration the consolidated businessresults, the dividend payout ratio, the accumulation level of the retained earnings and othermatters.
As for the year-end dividend for the 151st fiscal year, in consideration of the business results
for this fiscal year and other matters, the Company proposes to distribute in the amount of
sixteen yen (¥16) per share, which is the same as the interim dividend for this fiscal year.
As a result, the dividend for this fiscal year, including the interim dividend (sixteen yen (¥16)),is thirty two yen (¥32) per share, which is eight yen (¥8) per share less than that of thepreceding fiscal year.

1.

Matters concerning the year-end dividend(1)Type of properties to be distributed:
Cash

(2)

Matter concerning the allocation of properties to be distributed and the total
amount thereof:
Sixteen yen (¥16) per ordinary share of the Company
Total amount of dividends: 12,481,269,952 yen(3)Effective date of distribution of surplus:
June 28, 2021

2.

Other matters concerning the disposition of surplus
Not applicable.

Second item:
Appointment of fifteen (15) Directors due to the expiration of theterm of office of all of the current Directors
The term of office of all twelve (12) current Directors will expire upon the closing of thisMeeting. In order to aim to further strengthen the management system mainly through theincrease of the number of Outside Directors, approval is hereby requested for theappointment of fifteen (15) Directors.
The nominees for the offices of Directors are as stated on pages 7 to 22.
[Reference Information] List of Nominees for Directors
Position and Areas of
Responsibility in the Company(as of June 3, 2021)

NomineeNumberName

1

Masayoshi
Matsumoto
Osamu Inoue
MitsuoNishidaReappt.
Reappt.
Reappt.

President

4

Yoshitomo
Kasui

Reappt.

Senior Managing Director
Corporate Staff Group(Compliance & Risk Management,
Administration, Tokyo
Administration, Secretary, Human
Resources, Human Resources
Development, Internal Auditing)

15/15

5

Akira
Nishimura

Reappt.

Senior Managing Director
General Manager, R&D Unit
Electronics Group (Flexible Printed
Circuits Division)

15/15

6

Hideo Hato

Reappt.

Senior Managing Director
General Manager, New Business
Development Unit
Deputy General Manager,
Automotive Business Unit
(Systems & Electronics Division)
Corporate Staff Group (Legal,
Public Relations, Corporate
Planning, Intellectual Property,
Security Trade Control)
Environment and Energy Group(Energy System Division)

15/15

7

MasakiShirayama

Reappt.

Managing Director
General Manager, Electric Wire &Cable, Energy Business Unit

15/15

8

Nobuyuki
Kobayashi

Reappt.

Managing Director
Corporate Staff Group (Accounting,
Finance, Information Systems,
Procurement, Logistics Management)

15/15

2
3

Chairman of the Board of Directors

Executive Vice President
General Manager, Automotive
Business Unit

Number ofTimes Attending
Board ofDirectors
Meetings(FY2020)

15/15
15/15
15/15

Position and Areas of
Responsibility in the Company(as of June 3, 2021)

Number ofTimes Attending
Board ofDirectors
Meetings(FY2020)

Outside Director
O/S Ind. Officer
Outside Director
O/S Ind. Officer
Outside Director
O/S Ind. Officer

15/15

New appt.

Managing Executive Officer
General Manager, Electronics Sales
Unit-

Toshiyuki
Sahashi

New appt.

-

Katsuaki
Watanabe

New appt.

Managing Executive Officer
Deputy General Manager, Advanced
Materials Business Unit
Outside Audit & Supervisory Board
MemberO/S Ind. Officer
O/S Ind. Officer

NomineeNumberName

9

Hiroshi Sato

Reappt.

10

Michihiro
Tsuchiya
Christina
Ahmadjian
Yasuhiro
MiyataReappt.

13

14

11
12

15

Reappt.

15/15
15/15

-

Atsushi
New appt.
Horiba“Reappt.” means a reappointed nominee; “New appt.” means a newly appointed nominee;“O/S” means a nominee for Outside Director; and “Ind. Officer” means a nominee for
Independent Officer as defined by Tokyo Stock Exchange, Inc., etc.

Nominee
NumberName (Birth Date)

Number of Company Shares Owned

Masayoshi Matsumoto

65,200 shares(September 18, 1944)

Career Summary, Position, Areas of Responsibility and Important Concurrent Posts

1

Apr. 1967

Joined the Company

Jun. 1997

Director

Jun. 1999

Managing Director

Jun. 2003

Senior Managing Director

Jun. 2004

President

Jun. 2017

Chairman of the Board of Directors(currently maintained)
Important Concurrent Posts
Chairman, Kansai Economic Federation
Reasons Why the Company Nominates the Nominee as a Director
The Company has selected him as a nominee for the office of Director because he has been, as a
President since June 2004, and as a Chairman of the Board of Directors since June 2017, one of
the core members of the Company’s management and the Company considers him to be qualified
for the office of Director in light of the Company’s “Policy to Nominate Candidates for Director and
Audit & Supervisory Board Member, etc.”

Nominee
NumberName (Birth Date)

Number of Company Shares Owned

Osamu Inoue

39,210 shares(August 25, 1952)

Career Summary, Position, Areas of Responsibility and Important Concurrent Posts
Apr. 1975

Joined the Company

Jun. 2004

Executive Officer
Deputy General Manager, Automotive Business Unit

Jan. 2006

Executive Officer, Sumitomo Wiring Systems, Ltd.

Jun. 2006

Director, Managing Executive Officer, Sumitomo Wiring Systems, Ltd.

Jun. 2007

Director, Senior Managing Executive Officer, Sumitomo Wiring Systems, Ltd.

Jun. 2008

Managing Director,
General Manager, Automotive Business Unit of the Company

Apr. 2009

Director of the Company
President, Sumitomo Electric Bordnetze GmbH (now known as Sumitomo
Electric Bordnetze SE)

Jun. 2012

Deputy General Manager, Automotive Business Unit of the Company
Director, President, Sumitomo Wiring Systems, Ltd.

Apr. 2017Managing Executive Officer of the Company
Director, Sumitomo Wiring Systems, Ltd.

Jun. 2017

President of the Company

2(currently maintained)

Reasons Why the Company Nominates the Nominee as a Director
The Company has selected him as a nominee for the office of Director because he has been, as a
President, one of the core members of the Company’s management since June 2017 and theCompany considers him to be qualified for the office of Director in light of the Company’s “Policy to
Nominate Candidates for Director and Audit & Supervisory Board Member, etc.”

Nominee
NumberName (Birth Date)

Number of Company Shares Owned

Mitsuo Nishida(February 11, 1948)

22,890 shares

Career Summary, Position, Areas of Responsibility and Important Concurrent Posts

3

Apr. 1972

Joined the Company

Jun. 2005

Director, Senior Managing Executive Officer, Sumitomo Wiring Systems, Ltd.

Jun. 2007

Managing Executive Officer,
Deputy General Manager, Automotive Business Unit of the Company

Apr. 2009Managing Executive Officer
General Manager, Automotive Business Unit

Jun. 2009Managing Director
General Manager, Automotive Business Unit

Jun. 2010

Senior Managing Director
General Manager, Automotive Business Unit

Jun. 2014

Executive Vice President
General Manager, Automotive Business Unit

Apr. 2017

Ditto
General Manager, Manufacturing Management & Engineering Unit

Jun. 2020

Executive Vice President
General Manager, Automotive Business Unit

(currently maintained)
Areas of Responsibility:
General Manager, Automotive Business Unit
Important Concurrent Posts:
Chairman of Board of Directors, Sumitomo Wiring Systems, Ltd.
Chairman of the Board, Sumitomo Electric Wiring Systems, Inc.
Joint Representative Director, Kyungshin Co., Ltd.
Reasons Why the Company Nominates the Nominee as a Director
The Company has selected him as a nominee for the office of Director because he has been, as
an Executive Vice President, one of the core members of the Company’s management since June2014 and the Company considers him to be qualified for the office of Director in light of theCompany’s “Policy to Nominate Candidates for Director and Audit & Supervisory Board Member,etc.”

Nominee
NumberName (Birth Date)

Number of Company Shares Owned

Yoshitomo Kasui

26,900 shares(May 15, 1959)

Career Summary, Position, Areas of Responsibility and Important Concurrent Posts
Apr. 1983

Joined the Company

Jun. 2012

Executive Officer
Deputy General Manager, Manufacturing Management & Engineering Unit

Jun. 2013

Managing Executive Officer
Deputy General Manager, Manufacturing Management & Engineering Unit

Jun. 2014

Managing Director
Deputy General Manager, Manufacturing Management & Engineering Unit

Jun. 2018

Senior Managing Director
Deputy General Manager, Manufacturing Management & Engineering Unit

Jun. 2020

Senior Managing Director

4(currently maintained)
Areas of Responsibility:
Corporate Staff Group (Compliance & Risk Management, Administration, Tokyo Administration,
Secretary, Human Resources, Human Resources Development, Internal Auditing)Reasons Why the Company Nominates the Nominee as a Director
He has abundant business experience at the Administration and Human Resource Division. The
Company has selected him as a nominee for the office of Director because he has served as
Senior Managing Director and supervised the Corporate Staff Group including the Administrationand Human Resource Division since June 2018, and the Company considers him to be qualified
for the office of Director in light of the Company’s “Policy to Nominate Candidates for Director and
Audit & Supervisory Board Member, etc.”

Nominee
NumberName (Birth Date)

Number of Company Shares Owned

Akira Nishimura

18,000 shares(April 7, 1958)

Career Summary, Position, Areas of Responsibility and Important Concurrent Posts

5

Apr. 1984

Joined the Company

Jun. 2013

Executive Officer
Deputy General Manager, Infocommunications Business Unit

Jun. 2015

Managing Executive Officer
Deputy General Manager, Infocommunications Business Unit

Jun. 2016

Managing Director
General Manager, Infocommunications Business Unit

Jun. 2019

Senior Managing Director
General Manager, Infocommunications Business Unit

Jun. 2020

Senior Managing Director
General Manager, R&D Unit

(currently maintained)
Areas of Responsibility:
General Manager, R&D Unit
Electronics Group (Flexible Printed Circuits Division)
Reasons Why the Company Nominates the Nominee as a Director
He has abundant business experience at the Infocommunications Group and great insight into
technical development. The Company has selected him as a nominee for the office of Director
because he has served as Senior Managing Director since June 2019 and has served as General
Manager of the R&D Group since June 2020, and the Company considers him to be qualified forthe office of Director in light of the Company’s “Policy to Nominate Candidates for Director and
Audit & Supervisory Board Member, etc.”

Nominee
NumberName (Birth Date)

Number of Company Shares Owned

Hideo Hato

12,700 shares(September 3, 1957)

Career Summary, Position, Areas of Responsibility and Important Concurrent Posts

6

Apr. 1981

Joined the Ministry of International Trade and Industry

Jun. 2013

Commissioner, Patent Office

Jul. 2014

Retired from officeJun. 2016

Joined the Company
Managing Executive Officer

Jun. 2017Managing Director

Apr. 2018

Ditto
Deputy General Manager, Automotive Business Unit

Jun. 2018

Ditto
General Manager, New Business Development Unit

Jun. 2019

Senior Managing Director
General Manager, New Business Development Unit
Deputy General Manager, Automotive Business Unit

(currently maintained)
Areas of Responsibility:
General Manager, New Business Development Unit
Deputy General Manager, Automotive Business Unit (Systems & Electronics Division)
Corporate Staff Group (Legal, Public Relations, Corporate Planning, Intellectual Property,
Security Trade Control)
Environment and Energy Group (Energy System Division)
Reasons Why the Company Nominates the Nominee as a Director
He held important posts including as the Commissioner of the Patent Office and has abundant
experience. The Company has selected him as a nominee for the office of Director because hehas served as Senior Managing Director and General Manager of the New Business Development
Unit of the Company since June 2019, and the Company considers him to be qualified for theoffice of Director in light of the Company’s “Policy to Nominate Candidates for Director and Audit &Supervisory Board Member, etc.”

Nominee
NumberName (Birth Date)

Number of Company Shares Owned

Masaki Shirayama(November 29, 1961)

17,800 shares

Career Summary, Position, Areas of Responsibility and Important Concurrent Posts

7

Apr. 1985

Joined the Company

Jun. 2012

General Manager, Business Development DivisionJun. 2013

Executive Officer
Deputy General Manager, Network Products Sales & Marketing Unit
General Manager, New Business Marketing and Promotion Division
General Manager, Marketing & Promotion Department, New Business
Development Unit

Jun. 2014

Managing Executive Officer
General Manager, Social Infrastructure Sales & Marketing Unit

Jun. 2017Managing Director
General Manager, Social Infrastructure Sales & Marketing Unit

Jun. 2018

Managing Director
General Manager, Electric Wire & Cable, Energy Business Unit

(currently maintained)
Areas of Responsibility:
General Manager, Electric Wire & Cable, Energy Business Unit
Reasons Why the Company Nominates the Nominee as a Director
He has abundant business experience in the sales departments of infrastructure businesses. The
Company has selected him as a nominee for the office of Director because he assumed the officeof Managing Director in June 2017 and has served as General Manager of the Environment andEnergy Group since June 2018, and the Company considers him to be qualified for the office of
Director in light of the Company’s “Policy to Nominate Candidates for Director and Audit &Supervisory Board Member, etc.”

Nominee
NumberName (Birth Date)

Nobuyuki Kobayashi(May 31, 1961)

Number of Company Shares Owned

10,200 shares

Career Summary, Position, Areas of Responsibility and Important Concurrent Posts
Apr. 1985

Joined the Company

Jan. 2016

General Manager, Accounting DivisionJun. 2016

Executive Officer
Ditto

Jun. 2019

Managing Director(currently maintained)
8

Areas of Responsibility:
Corporate Staff Group (Accounting, Finance, Information Systems, Procurement, Logistics
Management)
Important Concurrent Posts:
Director, Sumitomo Rubber Industries, Ltd.
Reasons Why the Company Nominates the Nominee as a Director
He has abundant business experience in the Accounting and Finance Divisions, and has insight
into the global business activities of enterprises. The Company has selected him as a nominee
for the office of Director because he has served as Managing Director and supervised the
Corporate Staff Group including the Accounting and Finance Divisions since June 2019, and theCompany considers him to be qualified for the office of Director in light of the Company’s “Policy to
Nominate Candidates for Director and Audit & Supervisory Board Member, etc.”

Nominee
NumberName (Birth Date)

Number of Company Shares Owned

Hiroshi Sato
(September 25, 1945)
Nominee for Outside Director

8,700 shares

Nominee for Independent Officer
Career Summary, Position, Areas of Responsibility and Important Concurrent Posts

9

Apr. 1970

Joined Kobe Steel, Ltd.

Jun. 1996

Director, Kobe Steel, Ltd.

Apr. 1999

Ditto, Executive Officer, Kobe Steel, Ltd.

Jun. 1999

Managing Executive Officer, Kobe Steel, Ltd.

Jun. 2000

Director, Kobe Steel, Ltd., Ditto

Jun. 2002

Director, Senior Managing Executive Officer, Kobe Steel, Ltd.

Jun. 2003

Senior Managing Director, Kobe Steel, Ltd.

Apr. 2004

Executive Vice President and Director, Kobe Steel, Ltd.

Apr. 2009

President and Director, Kobe Steel, Ltd.

Apr. 2013

Chairman of the Board and Director, Kobe Steel, Ltd.

Apr. 2016

Senior Advisor and Director, Kobe Steel, Ltd.

Jun. 2016

Senior Advisor, Kobe Steel, Ltd.
Director of the Company (Outside Director)

Apr. 2018

Advisor, Kobe Steel Ltd.
Director of the Company (Outside Director)(currently maintained)
Important Concurrent Posts:
Advisor, Kobe Steel, Ltd.
President & Representative Director, The Kobe International House Inc.
Reasons Why the Company Nominates the Nominee as an Outside Director, Expected
Roles, etc.
He has abundant experience and great insight into overall business management, through being
involved in the management of a company conducting a wide range of business, such as
materials, machinery, and energy, with a central focus on iron and steel. Based on the foregoing,
the Company has selected him as a nominee for the office of Outside Director because theCompany expects that he will contribute to supervising management from an objective perspectivethat is independent from the execution of business and ensuring transparency and fairness in theconsideration of Officers’ personnel affairs and remuneration, and the Company considers him tobe qualified for the office of Outside Director in light of the Company’s “Policy to Nominate
Candidates for Director and Audit & Supervisory Board Member, etc.” While the Company has abusiness relationship with Kobe Steel, Ltd., where he previously served as an executive, involving
matters such as the purchase and sale of the products, the value of each transaction is less than
1% of the total sales of the Company and Kobe Steel, Ltd. respectively. Therefore, that fact
above does not influence his independence. The Company has no transactions with The Kobe
International House Inc., where he currently holds office as a President & Representative Director.

Nominee
NumberName (Birth Date)

Number of Company Shares Owned

Michihiro Tsuchiya(July 12, 1947)
Nominee for Outside Director

5,700 shares

Nominee for Independent Officer
Career Summary, Position, Areas of Responsibility and Important Concurrent Posts

10

Apr. 1976

Joined Tanabe Seiyaku Co., Ltd.
(now known as Mitsubishi Tanabe Pharma Corporation)

Jun. 2001

Board Director, Tanabe Seiyaku Co., Ltd.

Jun. 2003

Managing Board Director, Tanabe Seiyaku Co., Ltd.

Jun. 2005

Board Director, Managing Executive Officer, Tanabe Seiyaku Co., Ltd.

Jun. 2006

Representative Director, Senior Managing Executive Officer, Tanabe Seiyaku
Co., Ltd.

Oct. 2007

Board Director, Vice President, Mitsubishi Tanabe Pharma Corporation

Jun. 2008

Ditto
Director, Mitsubishi Chemical Holdings Corporation

Jun. 2009

President & Representative Director, Chief Executive Officer, Mitsubishi Tanabe
Pharma Corporation
Director, Mitsubishi Chemical Holdings Corporation

Jun. 2014

Chairman of the Board & Representative Director, Mitsubishi Tanabe Pharma
Corporation

Jun. 2016

Chairman of the Board, Mitsubishi Tanabe Pharma Corporation

Jun. 2017

Senior Advisor, Mitsubishi Tanabe Pharma Corporation

Jun. 2018

Ditto
Director of the Company (Outside Director)

Jun. 2019

Director of the Company (Outside Director)(currently maintained)
Important Concurrent Posts:
Director, RaQualia Pharma Inc. (Outside Director)
Reasons Why the Company Nominates the Nominee as an Outside Director, Expected
Roles, etc.
He has abundant experience and great insight into overall business management, through being
involved in the management of the companies developing global business activities. Based on
the foregoing, the Company has selected him as a nominee for the office of Outside Director
because the Company expects that he will contribute to supervising management from an
objective perspective that is independent from the execution of business and ensuringtransparency and fairness in the consideration of Officers’ personnel affairs and remuneration, andthe Company considers him to be qualified for the office of Outside Director in light of theCompany’s “Policy to Nominate Candidates for Director and Audit & Supervisory Board Member,etc.” The Company has no transactions with Mitsubishi Tanabe Pharma Corporation, where hepreviously served as an executive.

Nominee
NumberName (Birth Date)

Number of Company Shares Owned

Christina Ahmadjian(March 5, 1959)
Nominee for Outside Director

4,100 shares

Nominee for Independent Officer
Career Summary, Position, Areas of Responsibility and Important Concurrent Posts
Jan. 1995

Assistant Professor, Graduate School of Business, Columbia University,

Oct. 2001

Associate Professor, Graduate School of International Corporate Strategy,
Hitotsubashi University

Jan. 2004

Professor, Graduate School of International Corporate Strategy, Hitotsubashi
University

Apr. 2010

Dean of Graduate School, Graduate School of International Corporate Strategy,
Hitotsubashi University

Apr. 2012

Professor, Graduate School of Commerce and Management, Hitotsubashi
University

Apr. 2018

Professor, Graduate School of Business Administration, Hitotsubashi University

Jun. 2018

Ditto
Director of the Company (Outside Director)

11(currently maintained)
Important Concurrent Posts:
Professor, Graduate School of Business Administration, Hitotsubashi University
Director, Japan Exchange Group, Inc. (Outside Director)
Director, Mitsubishi Heavy Industries, Ltd. (Outside Director)
Director, Asahi Group Holdings, Ltd. (Outside Director)
Reasons Why the Company Nominates the Nominee as an Outside Director, Expected
Roles, and Reasons Why the Company Has Determined that the Nominee is Capable ofConducting the Duties Appropriately as an Outside Director
She has great insight and a global perspective as a university professor mainly studying in thefields of business management and corporate governance. Based on the foregoing, theCompany has selected her as a nominee for the office of Outside Director because the Company
expects that she will contribute to supervising management from an objective perspective that is
independent from the execution of business and ensuring transparency and fairness in theconsideration of Officers’ personnel affairs and remuneration, and the Company considers her tobe qualified for the office of Outside Director in light of the Company’s “Policy to Nominate
Candidates for Director and Audit & Supervisory Board Member, etc.” She has no experience
concerning company management other than acting as an Outside Director; however, theCompany has determined that she is capable of conducting the duties appropriately as an Outside
Director because of the reasons above. The Company has no transactions with and has madeno donations to Hitotsubashi University, where she serves as a professor.

Nominee
NumberName (Birth Date)

Number of Company Shares Owned

Yasuhiro Miyata(April 12, 1961)

4,600 shares

Newly appointed
Career Summary, Position, Areas of Responsibility and Important Concurrent Posts
Apr. 1984

Joined the Company

Jun. 2006

General Manager, Flexible Printed Circuits & Components Sales DivisionDec. 2011

President, Sumitomo Electric Interconnect Products (Hong Kong), Ltd.

Jun. 2013

Executive Officer
Deputy General Manager, Electronics Sales Unit
Ditto

Jun. 2014

Managing Executive Officer
General Manager, Electronics Sales Unit

12

(currently maintained)

Reasons Why the Company Nominates the Nominee as a Director
He has abundant business experience in the Sales Division for electronics products, and has
insight into the global business activities of enterprises. The Company has selected him as anominee for the office of Director because he has served as Managing Executive Officer andGeneral Manager of the Sales Group since June 2014, and the Company considers him to bequalified for the office of Director in light of the Company’s “Policy to Nominate Candidates for
Director and Audit & Supervisory Board Member, etc.”

Nominee
NumberName (Birth Date)

Number of Company Shares Owned

Toshiyuki Sahashi(December 31, 1960)
300 shares
Newly appointed

Career Summary, Position, Areas of Responsibility and Important Concurrent Posts

13

Apr. 1986

Joined the Company

Jun. 2016

President, Sumitomo Electric Hardmetal Corp.

Jun. 2017

Executive Officer
Ditto

Jun. 2019

Managing Executive Officer
Deputy General Manager, Advanced Materials Business Unit
President, Sumitomo Electric Hardmetal Corp.

(currently maintained)
Important Concurrent Posts:
President, Sumitomo Electric Hardmetal Corp.
Reasons Why the Company Nominates the Nominee as a Director
He has abundant business experience in the Industrial Materials Group, and has insight into theglobal business activities of enterprises. The Company has selected him as a nominee for theoffice of Director because he has served as Managing Executive Officer and Deputy General
Manager of the Industrial Materials Group since June 2019, and the Company considers him to bequalified for the office of Director in light of the Company’s “Policy to Nominate Candidates for
Director and Audit & Supervisory Board Member, etc.”

Nominee
NumberName (Birth Date)

Number of Company Shares Owned

Katsuaki Watanabe(February 13, 1942)
Newly appointed

13,800 shares

Nominee for Outside Director
Nominee for Independent Officer
Career Summary, Position, Areas of Responsibility and Important Concurrent Posts
Apr. 1964

Joined Toyota Motor Co., Ltd.
(now known as Toyota Motor Corporation)

Sept. 1992

Director, Toyota Motor Corporation

Jun. 1997

Managing Director, Toyota Motor Corporation

Jun. 1999

Senior Managing Director, Toyota Motor Corporation

Jun. 2001

Executive Vice President, Toyota Motor Corporation

Jun. 2005

President, Toyota Motor Corporation

Jun. 2009

Vice Chairman, Toyota Motor Corporation

Jun. 2011

Senior Advisor, Toyota Motor Corporation

Jun. 2013

Ditto
Audit & Supervisory Board Member (Outside Audit & Supervisory Board Member)of the Company

Jun. 2015

Advisor, Toyota Motor Corporation
Audit & Supervisory Board Member (Outside Audit & Supervisory Board Member)of the Company

Jul. 2018

Audit & Supervisory Board Member (Outside Audit & Supervisory Board Member)of the Company

14(currently maintained)
Important Concurrent Posts:
Director (Outside Director), Kyushu Financial Group, Inc.
Reasons Why the Company Nominates the Nominee as an Outside Director, Expected
Roles, etc.
He was involved for a long time in the management of a company that conducted its businessglobally, has extensive experience and great insight in relation to overall corporate management,
and has made comments on not only audits as an Outside Audit & Supervisory Board Member of
the Company, but also improvements in the efficiency of management, etc., from a broad
perspective. Based on the foregoing, the Company has selected him as a nominee for the officeof Outside Director because the Company expects that he will contribute to supervising
management from an objective perspective that is independent from the execution of business andensuring transparency and fairness in consideration of Officers’ personnel affairs andremuneration, and the Company considers him to be qualified for the office of Outside Director inlight of the Company’s “Policy to Nominate Candidates for Director and Audit & Supervisory Board
Member, etc.”
While the Company has a business relationship with Toyota Motor Corporation, where hepreviously served as an executive, involving matters such as the purchase and sale of products,
ten years or more have passed since he resigned as an executive of Toyota Motor Corporation,and he resigned from all positions at Toyota Motor Corporation in June 2018. In addition,
considering the scale of the relevant transactions, that fact above does not influence his
independence.

Nominee
NumberName (Birth Date)

Number of Company Shares Owned

Atsushi Horiba(February 5, 1948)
Newly appointed
Nominee for Outside Director

3,000 shares

Nominee for Independent Officer

Career Summary, Position, Areas of Responsibility, and Important Concurrent Posts
Sept. 1972

Joined HORIBA, Ltd.

Jun. 1982

Director of HORIBA, Ltd.

Jun. 1988

Senior Managing Director of HORIBA, Ltd.

Jan.1992

President of HORIBA, Ltd.

Jun. 1995

Ditto
President of STEC Co., Ltd. (now known as HORIBA STEC, Co., Ltd.)

Jun. 2005

Chairman, President & CEO of HORIBA, Ltd., President of HORIBA STEC, Co.,Ltd.

Apr. 2016

Chairman, President & CEO of HORIBA, Ltd., Chairman of HORIBA STEC, Co.,
Ltd.

Jan. 2018

Chairman & Group CEO of HORIBA, Ltd., Chairman of HORIBA STEC, Co., Ltd.

15

(currently maintained)
Important Concurrent Posts:
Chairman & Group CEO of HORIBA, Ltd.
Chairman of HORIBA STEC, Co., Ltd.
Director of SoftBank Corp. (Outside Director)
Reasons Why the Company Nominates the Nominee as an Outside Director, Expected
Roles, etc.
He was involved for a long time in the management of a company that conducted its businessglobally, has extensive experience and great insight in relation to overall corporate management.
Based on the foregoing, the Company has selected him as a nominee for the office of Outside
Director because the Company expects that he will contribute to further improvements insupervisory functions of management from an objective perspective that is independent from theexecution of business, and the Company considers him to be qualified for the office of Outside
Director in light of the Company’s “Policy to Nominate Candidates for Director and Audit &Supervisory Board Member, etc.”
While the Company has a business relationship with HORIBA, Ltd., where he currently holds office
as a Chairman & Group CEO, involving matters such as the outsourcing of repair of devices, thevalue of each transaction is less than 1% of the total sales of the Company and HORIBA, Ltd.
respectively. Therefore, that fact above does not influence his independence. In addition, while
the Company has a business relationship with HORIBA STEC, Co., Ltd., where he currently holds
office as a Chairman, involving matters such as the purchase of products, the value of eachtransaction is less than 1% of the total sales of the Company and HORIBA STEC, Co., Ltd.
respectively. Therefore, that fact above does not influence his independence.

Notes:1.

The Director nominee Mr. Mitsuo Nishida is the Joint Representative Director of KyungshinCo., Ltd., which is a Korean company manufacturing and selling automotive wiring harnesses
and their related components, and in which the Company and Sumitomo Wiring Systems, Ltd.
invest money equivalent to 30% and 20%, respectively, of the shareholding ratio. The
Company and that company do not have direct transaction relationship. Sumitomo Wiring
Systems, Ltd. and that company are in a transaction relationship, for example, conducting
sales and purchase of automotive wiring harness components and technical assistance to thatcompany.
The other nominees for the offices of Directors do not have business connections with theCompany.

2.

Mr. Hiroshi Sato, Mr. Michihiro Tsuchiya, Ms. Christina Ahmadjian, Mr. Katsuaki Watanabe,
and Mr. Atsushi Horiba are nominees for Outside Directors and for Independent Officers as
defined by Tokyo Stock Exchange, Inc., etc.

3.

Matters to be described specifically regarding the Outside Director nominees (Mr. Hiroshi
Sato, Mr. Michihiro Tsuchiya, Ms. Christina Ahmadjian, Mr. Katsuaki Watanabe, and
Mr. Atsushi Horiba) are as follows:(1)

The fact that the relevant stock company violated laws and regulations or its articles ofincorporation, or otherwise unfairly executed business during the term of office at therelevant stock company if a candidate for the office of Outside Director has held officein the past five years as a director, executive officer or auditor & supervisory board
member of another stock company
It was revealed in October 2017 that Kobe Steel, Ltd. (where Mr. Hiroshi Sato served
as a Director until June 2016) and its group have been involved in the misconduct
concerning the products and services provided by the group, such as the act offalsifying or fabricating inspection data for products falling short of public standards orcustomer specifications, and shipping or delivering those products to customers as if
they conformed to the public standards or customer specifications. In connection
with that, regarding some of those acts, that company was convicted of a breach of
the Unfair Competition Prevention Act in March 2019.

(2)

Number of years since the Outside Director nominees started to hold office as an
Outside Director or an Audit & Supervisory Board Member of the Company
Mr. Hiroshi Sato will have held office as an Outside Director for five (5) years upon theclosing of this Meeting.
Mr. Michihiro Tsuchiya and Ms. Christina Ahmadjian will have held office as Outside
Directors for three (3) years upon the closing of this Meeting.
Mr. Katsuaki Watanabe will have held office as an Outside Audit & Supervisory Board
Member for eight (8) years upon the closing of this Meeting.

(3)

Outline of the substance of the limited liability contract
The Company has entered into a limited liability contract with Mr. Hiroshi Sato,
Mr. Michihiro Tsuchiya, Ms. Christina Ahmadjian, and Mr. Katsuaki Watanabe. The
contract provides, with respect to the liability under Article 423, paragraph 1 of theCompanies Act, that each of them owes liability for damages limited to the higher
amount of either 10 million yen or the minimum liability amount provided under
Article 425, paragraph 1 of the Act, if they act without knowledge and are not grossly
negligent in conducting their duties.

In addition, if the appointment of Mr. Atsushi Horiba is approved, the Company willenter into a limited liability contract with him with the same content as that in thecontracts with each of the others above.
4.

The Company has entered into a directors and officers liability insurance contract under which
all Directors are the insureds, and the contract provides that insured Directors will be
responsible for execution of their duties or that the contract will compensate damages borne
as a result of claims that are received and related to pursuit of liability against them.
If each nominee starts to hold office as a Director, they will become the insureds under the
insurance contract and the insurance contract will be renewed during their term of office.

Third item: Appointment of one (1) Audit & Supervisory Board Member
The term of office of Audit & Supervisory Board Member Mr. Katsuaki Watanabe expires
upon the closing of this Meeting. Approval is hereby requested for the appointment of one(1) Audit & Supervisory Board Member.
The nominee for the office of Audit & Supervisory Board Member is as follows, and thisagenda has already been approved by the Audit & Supervisory Board.

Name (Birth Date)

Number of Company Shares Owned

Tatsuo Kijima(September 22, 1954)
Newly appointed
Nominee for Outside Audit & Supervisory Board
Member0 shares

Nominee for Independent Officer
Career Summary, Position and Important Concurrent Posts
Apr. 1978

Joined JNR

Jun. 2006

Executive Officer of West Japan Railway Company

Jun. 2009

Senior Executive Officer of West Japan Railway Company

Jun. 2010

Director and Senior Executive Officer of West Japan Railway Company

Jun. 2012

Vice President, Representative Director and Executive Officer of West Japan Railway
Company

Jun. 2016

President, Representative Director and Executive Officer of West Japan Railway Company

Dec. 2019

Vice Chairman and Director of West Japan Railway Company(currently maintained)
Important Concurrent Posts:
Vice Chairman and Director of West Japan Railway Company
Director of Osaka Gas Co., Ltd. (Outside Director)
Reasons Why the Company Nominates the Nominee as an Outside Audit & Supervisory Board Member
He was involved for a long time in the management of a company that supported social infrastructures mainly
involving transportation, has extensive experience and great insight in relation to overall corporate
management. The Company has selected him as a nominee for Outside Audit & Supervisory Board Member
because the Company considers him to be qualified for the office of Outside Audit & Supervisory Board
Member in light of the Company’s “Policy to Nominate Candidates for Director and Audit & Supervisory Board
Member, etc.”
While the Company has a business relationship with West Japan Railway Company, where he currently holds
office as a Vice Chairman and Director, involving matters such as the sale of products, the value of eachtransaction is less than 1% of the total sales of the Company and West Japan Railway Company respectively.
Therefore, that fact above does not influence his independence. In addition, in the annual securities reportsubmitted on June 25, 2020, the Company disclosed that it held 50,000 ordinary shares in West Japan Railway
Company, but it sold all of the shares of West Japan Railway Company which the Company held by the last
day of March 2021.

Notes:1.

The nominee for the office of Audit & Supervisory Board Member has no businessconnections with the Company.

2.

Mr. Tatsuo Kijima is a nominee for Outside Audit & Supervisory Board Member and forIndependent Officer as defined by Tokyo Stock Exchange, Inc., etc.

3.

Matters to be described specifically regarding the Outside Audit & Supervisory Board Member
nominee are as follows:-

Outline of the substance of the limited liability contract
If the appointment of Mr. Tatsuo Kijima is approved, the Company will enter into alimited liability contract with him. The contract provides, with respect to the liability
under Article 423, paragraph 1 of the Companies Act, that Mr. Tatsuo Kijima owes
liability for damages limited to the higher amount of either 10 million yen or theminimum liability amount provided under Article 425, paragraph 1 of the Act, if he acts
without knowledge and is not grossly negligent in conducting his duties.

4.

The Company has entered into a directors and officers liability insurance contract under which
all Audit & Supervisory Board Members are the insureds, and the contract provides that
insured Audit & Supervisory Board Members will be responsible for execution of their duties orthat the contract will compensate damages borne as a result of claims that are received andrelated to pursuit of liability against them.
If Mr. Tatsuo Kijima starts to hold office as an Outside Audit & Supervisory Board Member, hewill become the insured under the insurance contract and the insurance contract will berenewed during his term of office.

[Reference Information]
The “Policy to Nominate Candidates for Director and Audit & Supervisory Board Member, etc.” of theCompany is as follows:1.

Candidates to be nominated as Inside Directors will be individuals who have and have carriedout the Sumitomo Spirit – which values doing your sincere best, not only in business but alsoin every aspect of your life, placing importance on integrity and not acting rashly or carelesslyin pursuit of immoral business. These will be individuals who have extensive experience andexcellent performance records in connection with our business; who have sound objective
judgement concerning management in light of the changing environment surrounding us andfuture changes; and who have superior character, foresight and insight.

2.

Candidates to be nominated as Outside Directors will be individuals with experience incompany management, experts of respective fields or academic experts who would besuitable for supervising our management from the viewpoint of encouraging sustainablegrowth and striving to increase corporate value over the mid-to-long term.

3.

If a Director is found to be in material breach of compliance with the laws and regulations or
the Articles of Incorporation, or it is otherwise determined that they are not able toappropriately fulfill their role or responsibility as a Director, the submission of an agenda fordismissal to the meeting of shareholders may be deliberated, depending on thecircumstances.

4.

Candidates to be nominated as Audit & Supervisory Board Members will be individuals withexperience in company management and persons with expertise in law, finance or accounting.

5.

The Nominating Advisory Committee will deliberate the candidates for Directors and Audit &Supervisory Board Members and the submission of an agenda regarding the dismissal of a
Director to the meeting of shareholders, and the Board of Directors will decide them by aresolution based on the report of the committee.

Fourth item:

Payment of bonuses to Directors

The Company proposes to declare bonuses totaling 130 million yen (¥130,000,000) for nine(9) Directors, other than the three (3) Outside Directors, from among the twelve (12) total
Directors, as of the end of this fiscal year. With respect to this item, the Company took theexisting amount of payments and other factors into consideration, as well as the businessresults for this fiscal year based on the policy for determining bonuses. Further, theCompensation Advisory Committee, of which more than half of the members consist ofoutside officers, deliberated and reported to the Board of Directors that this item isappropriate. Based on these facts, the Company has determined that the details of this item
are proper.
Fifth item:

Revision of the amount of remuneration of Directors

With respect to the current amount of Directors’ remuneration, the amount of monthly
remuneration of Directors is not more than 70 million yen (of this, the amount of monthly
remuneration of Outside Directors is not more than 6 million yen) as resolved at the 146th
Ordinary General Meeting of the Shareholders, held on June 24, 2016. If the Second item
is adopted as proposed, the number of Outside Directors will increase by two (2) to become
five (5). In addition, in order to continue to secure human resources with various,
appropriate insights, the Company requests approval to revise the amount of monthly
remuneration of Outside Directors to be not more than 10 million yen, out of the total amountof monthly remuneration of Directors of 70 million yen.
Further, as in the past, the Company proposes to have the amount of remuneration of
Directors not include the amount of employee salaries of Directors who have duties as
employees. In addition, if the Second item is adopted as proposed, the number of Directors
will be fifteen (15) (of which, the number of Outside Directors will be five (5)).
Moreover, this item was considered based on the policy for determining remuneration of
Directors. In addition, the Compensation Advisory Committee, of which more than half ofthe members consist of outside officers, deliberated and reported to the Board of Directorsthat this item is appropriate. Based on these facts, the Company has determined that thedetails of this item are proper.
Sixth item:

Revision of the amount of remuneration of Audit & Supervisory
Board Members

With respect to the current amount of Audit & Supervisory Board Members’ remuneration, theamount of monthly remuneration of Audit & Supervisory Board Members is not more than 10
million yen as resolved at the 137th Ordinary General Meeting of the Shareholders, held on
June 27, 2007. In order to continue to secure human resources with various, appropriate
insights, and to consider the system of Audit & Supervisory Board Members with flexibility
depending on the business conditions of the Group, the Company requests approval torevise the amount of monthly remuneration of Audit & Supervisory Board Members to be notmore than 12 million yen.
Further, if the Third item is adopted as proposed, the number of Audit & Supervisory Board
Members will remain five (5).

(Translation)(Attachment)
BUSINESS REPORT(from April 1, 2020 to March 31, 2021)

1.

Matters Concerning Current Status of Corporate Group(1)

Progression of Business and its Results

With respect to the world economy, economic and social activities around the world
were restricted due to the worldwide COVID-19 pandemic, and the economy deteriorated
considerably during the first quarter. Since the second quarter, the economy generally has
showed a trend toward recovery, but due to the re-expansion of COVID-19 in some regions,
economic and social activities were restricted again, and weakness still remains in someregions.
The business environment for the Group was severe mainly in the first half due to a
decline in the price of optical fiber cables, in addition to a decrease in production of
automobiles caused by COVID-19 and delays in communication and power supply work. In
this environment, regarding the consolidated financial settlement for this fiscal year, net sales
decreased from the preceding fiscal year to 2,918,580 million yen (preceding fiscal year:
3,107,027 million yen, -6.1%). With respect to income, despite our all-out efforts toward
cost reduction measures, such as cutting down non-urgent costs and refraining from capital
expenditures, not all of the effect of the decrease in sales could be absorbed.
Consequently, operating income amounted to no more than 113,926 million yen (preceding
fiscal year: 127,216 million yen, -10.4%), ordinary income was 114,072 million yen(preceding fiscal year: 130,498 million yen, -12.6%), and the profit attributable to owners of
the parent was 56,344 million yen (preceding fiscal year: 72,720 million yen, -22.5%), each ofwhich resulted in the amount below the amount in the preceding fiscal year. Further, in thesecond half, net sales were 1,679,293 million yen, operating income was 125,340 million
yen, ordinary income was 138,115 million yen, and the profit attributable to owners of theparent was 98,216 million yen. Due to the effect of the company-wide efforts in cost
reduction measures in addition to the fact that demand for products for automobiles
remained at a high level as a result of a sharp recovery of automobile production, the income
and the profit have increased compared with the second half of the preceding fiscal year, andthe net sales and each of the income and profit items showed the highest amounts ever inthe second half.
The following section is a report giving an outline of each segment.
(i)

The Automotive Segment

Because demand for wiring harnesses, car electronic components, and anti-vibration
rubbers and hoses decreased because of a decline in automobile production due to COVID19 mainly in the first quarter, net sales decreased by 81,588 million yen (4.8% compared withthe preceding fiscal year) to 1,602,042 million yen. Although we implemented our best cost
reduction measures, operating income decreased by 20,015 million yen to 48,198 million yen
due to substitutional production due to a lockdown of some production sites, and an increasein logistics cost due to a sharp recovery of demand in the second half, in addition to adecrease in sales.

(ii)The Infocommunications Segment

Net sales increased by 7,175 million yen (3.3%) to 224,576 million yen due to anincrease in demand for products such as optical/electronic devices and access network
equipment. Operating income increased by 6,508 million yen to 24,343 million yen due toabsorption of the price reduction in optical fiber by an increase in sales and cost reductions
due to productivity improvement.
(iii)

The Electronics Segment

Despite a decrease in sales of FPCs (flexible printed circuits) for mobile devices, net
sales were 252,618 million yen (an increase of 448 million yen, 0.2%), which remained
almost at the same level compared with the preceding fiscal year due to contribution by
TECHNO ASSOCIE Co., Ltd., a company that was made a subsidiary of the Company in thesecond quarter of the preceding fiscal year, in addition to an increase in demand forelectronic wire products, such as leads (tab leads) for battery terminals. Operating income
increased by 9,511 million yen to 10,047 million yen, due to an increase in sales of electronic
wire products, and our efforts for recovery of profitability, such as cost improvements in FPCs
for mobile devices and withdrawal from unprofitable products.
(iv)

The Environment and Energy Segment

Net sales decreased by 78,352 million yen (11.0%) to 634,191 million yen, due todelay in projects for power cables and power supply work, as well as a decrease in demandfor industrial wires for the construction market and the electricity sales market, and adecrease in Sumitomo Densetsu Co., Ltd.’s electric equipment work, in addition to a decline
in demand for products for automobiles, such as magnet wires and porous metals (Celmet)
for batteries for electric vehicles due to the effects of COVID-19. Operating income
decreased by 2,090 million yen to 25,024 million yen due to the decrease in sales.
(v)

The Industrial Materials Segment and Others

Due to a considerable decline in demand for cemented carbide tools, diamond and
CBN tools, sintered powder metal parts, spring steel wires, steel tire cord, etc., especially inthe first half, due to the effects of COVID-19, net sales decreased by 28,826 million yen(8.7%) to 302,524 million yen. Operating income decreased by 6,765 million yen to 6,660
million yen, mainly due to deterioration in profitability associated with a decrease in theoperation rate of factories.

Net Sales and Operating Income Breakdown by Segment

Segment

Automotive
Infocommunications
Electronics
Environment andEnergyIndustrial Materials
and Others
Elimination ofIntersegment
Transactions, etc.
Total
(2)

Preceding Fiscal Year
Operating
Net Sales
IncomeThis Fiscal Year
Operating
Net Sales
Incomemillions of yen

millions of yen

millions of yen

millions of yen

1,683,630
217,401
252,170

68,213
17,835536

1,602,042
224,576
252,618

48,19824,343
10,047

712,543

27,114

634,191

25,024331,350

13,425

302,524

6,660(90,067)93(97,371)(346)

millions of yen

millions of yen

millions of yen

millions of yen

3,107,027

127,216

2,918,580

113,926

Conditions of Capital Expenditure

The total amount of capital expenditure for this fiscal year was 172.2 billion yen. The
following list shows the breakdown of capital expenditure by segment.

Segment

Amount of Capital
Expenditure(billions of yen)

Automotive

89.3

Infocommunications

24.9

Electronics

11.9

Environment and Energy

30.1

Industrial Materials andOthers16.1(3)

Main Content of Capital Expenditure
Increased production of andrationalization investment in wiring
harnesses and anti-vibration rubbers
Increased production of andrationalization investment in
optical/wireless devices and optical fiber
cablesIncreased production of andrationalization investment in FPCs andelectronic wires
Increased production of andrationalization investment in magnet wires
and power transmission
wires/cables/equipment
Increased production of andrationalization investment in sinteredpowder metal parts and cemented carbide
tools

Fund-raising

The Group raised funds through long-term loans of 81.6 billion yen and through othermeans. The purpose of such fund-raising was allocation to repayment of long-termborrowings and equipment funds, etc.

(4)Key Issues Requiring Attention

Regarding the economic situation hereafter, there is concern that the normalization of
economic and social activities will be slower than expected due to the existence of uncertain
factors, such as the expansion of people infected with variant strains, although it is expectedthat COVID-19 will come to an end as vaccination advances. In addition, it is anticipatedthat the situation surrounding the business environment of the Company will continue to be
unpredictable because there are grounds for concern, including political and geopoliticalrisks, such as the trade policy in the U.S. and China, uncertainties in semiconductor supply,
and a lack of containers for logistics.
In these circumstances, the Group will strive to improve the basics of the
manufacturing industry, “S” (Safety), “E” (Environment), “Q” (Quality), “C” (Cost), “D”(Delivery), and “D” (Development), while continuing to give top priority to employee healthand safety, as well as maintenance and security of the supply chain. Further, in our efforts
to improve asset efficiency, for the improvement of ROIC*, which we regard as an important
index, we will make efforts to optimize inventory balance and accounts receivable, andaccounts payable balances, and to implement careful selection of capital expenditure
projects, etc. By doing so, we intend to establish a strong corporate structure that cantolerate any environment and endeavor to achieve “VISION 2022”, the mid-term
management plan ending in 2022, on which we are working with a concept of “Contributing
to a better society by leveraging our expertise in connectivity and transmission technologies
through concerted efforts of the entire group” aiming to become a “Glorious Excellent
Company.” In particular, we are pursuing the following strategies in each of our businesssegments.
In the Automotive segment, we will continue the cost reduction activities, which wehave worked on as measures against COVID-19, and will proceed further with building a leancorporate structure, which can endure demand fluctuations. For the realization of a mega
supplier, having wiring harnesses as its core, the Group will create new products related toso-called CASE* such as high-voltage wiring harnesses for electric vehicles, and connectors
for high-speed communication, by improving proposal-type marketing to customers, and will
expedite the use of more aluminum for harnesses corresponding to the needs of weight
reduction; moreover, it will strive to further expand its market share for overseas customers.
Sumitomo Riko Company Limited will strive to recover profitability by deepening global
support, integrating and concentrating business sites inside and outside of Japan, andreducing costs, in the field of automotive anti-vibration rubbers and hoses, and it is also
focusing on developing new products for the next-generation vehicles
In the Infocommunications segment, with regard to the expansion of the market forcloud services*, such as optical fibers.
In the Electronics segment, with regard to FPCs, we will continuously strive for
improvements in profitability through optimization of global production organization andimprovements in productivity, and we will accelerate marketing for automobiles anddevelopment of new products with high-definition and high frequency characteristics. With
regard to leads (tab leads) for battery terminals of electric vehicles, wires for electric parking
brakes, heat shrink tubes, and water-treatment systems, which utilize unique technologies
such as electric beam irradiation and fluorine resin processing, we will strive to expand
business by capturing various customer needs. In addition, we will strive for expansion ofbusiness synergies with TECHNO ASSOCIE Co., Ltd., which we made our subsidiary bymeans of a tender offer during the preceding fiscal year.
* ROIC: an abbreviation for Return on Invested Capital.
* CASE: A term that represents an automotive industry trend and combines the initials of “Connected,”“Autonomous,” “Shared,” and “Electric.”* Cloud services: providing data and software that previously were used by users on local computers,

as a service to users via a network.

In the Environment and Energy segment, with regard to power cables, we will ensurethat we secure new large-scale projects overseas, domestic demand for replacement offacilities, and renewable energy projects whose markets are expanding in the direction ofrealizing a decarbonized society, and focus on cost reductions, quality improvement,
development of new products, and strengthening project management. In addition, withregard to flat magnet wires for motors used in electric vehicles, we will proceed withstrengthening global production capacity in response to the increase in demand.
Furthermore, we will strive to expand orders further, while taking advantage of the Group’s
integrated capabilities, including those of Nissin Electric Co., Ltd. and Sumitomo DensetsuCo., Ltd.
In the Industrial Materials segment, with regard to cemented carbide tools, we will
respond to the demand that is recovering from the effects of COVID-19 in a timely andappropriate manner and will proceed with new business development of electric vehicle
components and tools for aircraft components and will make efforts to expand our market
share. With regard to sintered powder metal parts, for future business development, we will
work to further strengthen marketing for electric vehicles and the cost competitiveness ofeach production base that is developing globally. With regard to prestressed concrete andprecision spring steel wires, we will aim to improve profitability by strengthening global
production and sales organization and developing new products.
In research and development activities, we will make efforts to create new businesses
and products that are original and excel in profitability. This includes the prompt
commercialization of magnesium alloy products, superconducting products, SiC (siliconcarbide) power semiconductor devices, redox flow batteries, concentrator photovoltaic
systems and so on, and we will continuously strive for development of next-generation
products that support the current five business segments and development of new
manufacturing methods. Taking a long-term perspective, we will focus on developing new
products in response to society’s needs, including searching for new materials with new
functions by proactively utilizing outside knowledge through collaboration with academia,
industry, government, and so on, as well as working toward production innovation by utilizing
AI and IoT at manufacturing sites. Also, in order to revitalize research and development
activities further, we will further strengthen collaboration with the Business Division and theSales & Marketing Division and will conduct progress management of themes proactively.
Ultimately, we believe that compliance with laws and regulations and maintaining
corporate ethics constitute the foundation of the Company’s management, and that they are
the absolute basis to continue and develop as a corporation. From now on, under the
principles of the Sumitomo Spirit, which values doing your sincere best, not only in businessbut also in every aspect of your life, placing importance on integrity, and not acting rashly or
carelessly in pursuit of immoral business, we will make all efforts to ensure that all corporate
activities are conducted fairly and honestly and can be trusted by society. In addition, we
consider that the Sumitomo Spirit and the Sumitomo Electric Group Corporate Principles
share common core values with the SDGs (Sustainable Development Goals); the Groupaims to provide various values in order to realize “A safe and secure society,” “A green
society” and “A comfortable and viable society” through concerted efforts.
We would like to ask our shareholders for your further understanding and support in
the future.

(5)Trend of Assets and Profits or Losses(i)Trend of Assets and Profit or Losses of Corporate Group (Consolidated)
Year

Entry
Net Sales(millions of yen)
Operating Income(millions of yen)
Ordinary Income(millions of yen)
Profit Attributableto Owners of the
Parent(millions of yen)
Earnings per
Share
(yen)
Net Assets(millions of yen)
Total Assets(millions of yen)

FY2020(this fiscal year)

FY2016FY2017FY2018FY20192,814,483

3,082,247

3,177,985

3,107,027

2,918,580

150,503

173,139

166,260

127,216

113,926

173,872

195,010

188,649

130,498

114,072

107,562

120,328

118,063

72,72056,344137.61

154.29151.38

93.24

72.25

1,628,615

1,764,086

1,776,313

1,766,647

1,892,506

2,907,292

2,999,903

3,053,263

3,100,260

3,381,914(Notes)1.
Earnings per share is computed based on the weighted average number of shares of common
stock outstanding during each period.
2.
The U.S. consolidated subsidiaries have adopted IFRS instead of U.S. GAAP from the
beginning of FY2020, and with respect to FY2019, the amounts have been adjusted
retrospectively to reflect the changes in accounting policy.
3.
The Company and its domestic consolidated subsidiaries have applied “Accounting Standard
for Revenue Recognition” (ASBJ Statement No. 29, March 30, 2018) and “Implementation
Guidance on Accounting Standard for Revenue Recognition” (ASBJ Guidance No. 30, March
30, 2018) from the beginning of FY2020.
4.
With respect to FY2018, the decrease in production of automobiles in China and Europe has
become prominent since the second half of FY2018, and despite the worldwide
underperformance of smartphone sales and a fade in demand in some parts of the cemented
carbide tools markets, the first half generally showed steady growth. Therefore, net sales
increased from the preceding fiscal year. However, due to price reductions in the automobile
industry and factors that increase costs such as additional duties between the U.S. and China,
in addition to an increase in research and development costs for the future, operating income,ordinary income, and the profit attributable to owners of the parent decreased from thepreceding fiscal year.
5.
With respect to FY2019, due to, e.g., a decrease in production of automobiles and sales ofsmartphones, a decline in the price of optical fiber cables, a stronger yen, and a fall in theprice of copper, as well as a sudden slowdown of economic activities due to COVID-19 in the
fourth quarter, sales decreased from the preceding fiscal year. Further, due to, e.g., adecrease in sales, an increase in future depreciation and amortization expenses, and pricereductions and an increase in costs for the launch of production of some products in the
Automotive segment, as well as deterioration in profitability associated with a sudden
decrease in production due to the expansion of COVID-19, operating income, ordinary
income, and the profit attributable to owners of the parent decreased from the preceding fiscal
year.
6.
With respect to FY2020, please see “(1) Progression of Business and its Results” above.

(ii)Trend of Assets and Profits or Losses of the Company
Year

Entry

FY2016Net Sales(millions of yen)
Operating Income(millions of yen)
Ordinary Income(millions of yen)
Profit for the year
(millions of yen)
Earnings per
Share
(yen)
Net Assets(millions of yen)
Total Assets(millions of yen)

FY2020(this fiscal year)

FY2017FY2018FY2019901,892

1,084,165

1,142,621

1,149,030

1,064,781(924)

12,714

16,921

3,882(7,007)49,36765,52365,847

48,62526,87442,73761,357

71,14742,442

9,558

54.66

78.65

91.20

54.41

12.25

707,105

739,165

783,028772,037

762,483

1,237,498

1,288,934

1,351,028

1,331,126

1,376,632(Notes)
Earnings per share is computed based on the weighted average number of shares of common stock
outstanding during each period.

(6)

Content of Main Businesses (as of March 31, 2021)

The Group conducts manufacturing and sales of the following products, as well as
construction design and execution.
Segment
Automotive

Infocommunications

Electronics

Environment andEnergyIndustrial Materials
and Others

Main products and others
Wiring harnesses, anti-vibration rubbers/automotive hoses, carelectronic components and network system products such as
traffic control
Optical fiber cables, telecommunication cables and equipment,
fusion splicers, optical/wireless devices such as opticaltransceiver modules/wireless communication devices, compound
semiconductors, access network equipment (GE-PON/set-top
box/CATV-related products, etc.)
Electronic wires, electric beam irradiation products, flexible
printed circuits, fluorine resin products, fasteners, metal parts,
chemical productsElectric conductors, power transmission wires/cables/equipment,
magnet wires, air cushions for railroad vehicles, power systemequipment such as substation equipment/control system, charged
beam equipment and processing, electrical/power supply workand engineering, porous metals, metal materials for electronicparts
Tensioning materials for prestressed concrete, precision spring
steel wires, steel tire cord, cemented carbide tools, diamond and
CBN tools, laser optics, sintered powder metal parts,
semiconductors heat-spreader materials

(7)Main Offices and Factories (as of March 31, 2021)(i)

The Company

Head Office Osaka City

Offices

Osaka, Tokyo, Chubu District Office (Nagoya City), Okinawa Branch Office (NahaCity), Kyushu Branch Office (Fukuoka City), Shikoku Sales Office (Takamatsu City),
Chugoku Branch Office (Hiroshima City), Hokuriku Sales Office (Toyama City),
Hitachi Branch Office (Hitachi City, Ibaraki Prefecture), Tohoku Branch Office (SendaiCity), Hokkaido Branch Office (Sapporo City)

Factories

Osaka Works (Osaka City), Itami Works (Itami City, Hyogo Prefecture),
Yokohama Works (Yokohama City), Ibaraki Works (Hitachi City, Ibaraki Prefecture)(ii)

Subsidiaries(Domestic)
Company Name

Location

Sumitomo Wiring Systems, Ltd.

Yokkaichi City, Mie Prefecture

Sumitomo Electric Device Innovations, Inc.

Yokohama City

Sumitomo Riko Company Limited

Nagoya City

Sumitomo Electric Hardmetal Corp.

Itami City, Hyogo Prefecture

Nissin Electric Co., Ltd.

Kyoto City

J-Power Systems Corporation

Hitachi City, Ibaraki Prefecture

Sumitomo Densetsu Co., Ltd.

Osaka CityTECHNO ASSOCIE Co., Ltd.

Osaka City

Hokkaido Sumiden Precision Co, Ltd.

Naie, Sorachi Subprefecture, Hokkaido

Sumitomo Electric Sintered Alloy, Ltd.

Takahashi City, Okayama Prefecture

Sumitomo Electric Wintec, Inc.

Koka City, Shiga Prefecture(Overseas)
Company Name

Location

Sumitomo Electric Wiring Systems, Inc.

U.S.A.

Sumitomo Electric Lightwave Corp.

U.S.A.

Sumidenso do Brasil Industrias Eletricas Ltda.

BrazilSumitomo Electric Wiring Systems (Europe) Limited

U.K.

Sumitomo Electric Bordnetze SE

Germany

SEWS-CABIND S.p.A.

Italy

PT. Karya Sumiden Indonesia
PT. Sumi Indo Kabel Tbk.

Indonesia
Indonesia

SEI Thai Electric Conductor Co., Ltd.

Thailand

Sumitomo Electric Interconnect Products (Shenzhen), Ltd.

China

Sumidenso Mediatech Suzhou Co., Ltd.

China

Sumitomo Electric Interconnect Products (Suzhou), Ltd.
Fuzhou Zhu Wiring Systems Co., Ltd.

China

Huizhou Zhurun Wiring Systems Co., Ltd.

China

Sumitomo Electric Interconnect Products (Hong Kong), Ltd.

Hong Kong, China

SEI Electronic Components (Vietnam), Ltd.

VietnamChina

Company Name

Location

Sumidenso Vietnam Co., Ltd.

Vietnam

Sumi Philippines Wiring Systems Corporation

Philippines(iii)

Affiliated Companies
Company Name

Location

Sumitomo Rubber Industries, Ltd.

Kobe City(8)

Employee Situation (as of March 31, 2021)(i)

Employee Situation of Corporate Group
Segment

Number of Employees

Automotive
Infocommunications
Electronics
Environment and Energy
Industrial Materials and Others
Total

Increase fromMarch 31, 2020

229,099

3,164

6,970
20,480267(740)

14,69784

15,53899

286,784

2,874(Note) “Number of Employees” means the number of actual employees on duty (i.e., the number of
employees dispatched to non-consolidated companies is not included, but the number of
those dispatched from non-consolidated companies is included).

(ii)

Employee Situation of the Company
Number of Employees
6,136

Increase fromMarch 31, 2020
116

Average age
41.7

Average Length of Service(Years)16.8(Note) “Number of Employees” does not include the 5,678 employees of the Company who aredispatched to companies other than the Company.

(9)

Status of Important Subsidiaries and Affiliates (as of March 31, 2021)
Company Name

CapitalShareholding

JPY

100.00

Manufacture, processing and sales of automotive
wiring harnesses, connectors

100.00Development, manufacture and sales of opticaltransceiver, optical/wireless devices composedof compound semiconductors, and theirapplication

Main Business%
Sumitomo Wiring
Systems, Ltd.
Sumitomo Electric
Device Innovations,
Inc.

Sumitomo RikoCompany Limited

20,042 Million
JPY
15,000 Million

JPY

50.67

12,145 Million(1.14)

Manufacture and sales of anti-vibration rubbers,
hoses and resin productsCompany Name

CapitalShareholding

Sumitomo Electric
Hardmetal Corp.

JPY

100.0011,900 Million

Nissin Electric Co.,Ltd.

10,253 Million

Main Business%

J-Power Systems
Corporation

JPY

JPY
8,000 Million

51.00

Manufacture and sales of substation equipment,
plant control system, photovoltaic system, etc.

100.00

Manufacture and sales of power transmission
wires/cables

Sumitomo DensetsuCo., Ltd.

JPY

50.17

6,440 Million(0.14)TECHNO ASSOCIE
Co., Ltd.

JPY

47.39

5,001 Million(0.00)

Hokkaido Sumiden
Precision Co, Ltd.

JPY
4,350 Million

100.00Sumitomo Electric
Sintered Alloy, Ltd.

JPY

Sumitomo Electric
Wintec, Inc.
Sumitomo Electric
Wiring Systems, Inc.
<U.S.A.>
Sumitomo ElectricLightwave Corp.
<U.S.A.>
Sumidenso do Brasil
Industrias Eletricas
Ltda. <Brazil>
Sumitomo Electric
Wiring Systems(Europe）Limited<U.K.>
Sumitomo Electric
Bordnetze SE<Germany>
SEWS-CABIND
S.p.A. <Italy>
PT. Karya Sumiden
Indonesia <Indonesia>
PT. Sumi Indo Kabel
Tbk. <Indonesia>
SEI Thai Electric
Conductor Co., Ltd.
<Thailand>

3,004 Million
JPY
3,000 Million

Manufacture and sales of cemented carbide
tools, diamond and CBN tools, etc.

Design, installation and supervision of powertransmission lines, indoor wiring cables andcommunications system works
Sales of screws, non-ferrous metal products, etc.

(100.00)

Manufacture and sales of cemented carbide andraw metal powder

100.00

Manufacture and sales of sintered powder metalparts

100.00

Manufacture and sales of magnet wires

Manufacture and sales of automotive wiring
harnesses and connectors

USD

100.00243,920 Thousand(40.00)USD

100.0054,780 Thousand(100.00)

BRL

100.00232,921 Thousand(60.71)EUR

100.0093,950 Thousand(40.00)EUR

100.002,046 Thousand(40.00)EUR

100.0030,000 Thousand(40.00)USD

100.0044,109 Thousand(4.49)

USD

92.40

52,431 Thousand(0.21)

THB
2,010 Million

100.00(0.00)

Manufacture and sales of optical cables, etc., andsales of fusion splicers, etc.
Manufacture and sales of automotive wiring
harnesses

Manufacture and sales of automotive wiring
harnesses and connectors

Manufacture and sales of automotive wiring
harnesses
Manufacture and sales of automotive wiring
harnesses
Manufacture and sales of wire rods

Manufacture and sales of wire cables

Manufacture and sales of wire rods, aluminum
wire rods and bars, automotive aluminum wires

Company Name

CapitalMain Business%

Sumitomo ElectricInterconnect
Products(Shenzhen), Ltd.
<China>RMB
623,483 Thousand

Sumidenso Mediatech
Suzhou Co., Ltd.
<China>RMB
347,585 Thousand

Sumitomo ElectricInterconnect Products(Suzhou), Ltd.
<China>RMB
338,299 Thousand※
Fuzhou Zhu Wiring
Systems Co., Ltd.
<China>RMB
275,236 Thousand

Huizhou Zhurun
Wiring Systems Co.,
Ltd. <China>

RMB
288,020 Thousand

Sumitomo ElectricInterconnect Products(Hong Kong), Ltd.
<Hong Kong, China>

HKD
648,000 Thousand

SEI Electronic
Components(Vietnam), Ltd.
<Vietnam>Shareholding

USD
100,000 Thousand

Sumidenso Vietnam
Co., Ltd. < Vietnam>

USD
35,000 Thousand

Sumi Philippines
Wiring Systems
Corporation< Philippines>

USD
60,000 Thousand

Sumitomo Rubber
Industries, Ltd.

JPY
42,658 Million

100.00(100.00)

100.00

Manufacture and sales of electronic wires, flexible
printed circuits(100.00)

Manufacture and sales of automotive wiring
harnesses

100.00

Manufacture and sales of electronic wires

100.00

Manufacture and sales of automotive wiring（100.00） harnesses and electric wires

87.86(87.86)

Manufacture and sales of automotive wiring
harnesses

100.00

Sales of electronic wires, flexible printed circuits

100.00

Manufacture and sales of flexible printed circuits

100.00

Manufacture and sales of automotive wiring
harnesses(100.00)
100.00(100.00)
28.91(0.06)

Manufacture and sales of automotive wiring
harnesses and electric wires

Manufacture and sales of automotive tires, etc.

(Notes)1.
The figures in parentheses under “Shareholding” indicate the shareholding of the Company’s
subsidiaries.
2.
A company marked with “※” under “Company Name” is a company added to the list starting
this fiscal year.

(10)Major Lenders (as of March 31, 2021)
Lenders

Balance of Borrowings
millions of yen

Sumitomo Mitsui Banking Corporation
The Norinchukin Bank
Mizuho Bank, Ltd.
Development Bank of Japan Inc.
MUFG Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited

94,13478,76378,50951,00048,24219,801(Notes)1.
The balance of borrowings above includes the borrowings from the overseas
subsidiaries of each financial institution.
2.
In addition to what is set forth in the table above, there is a syndicated loan whichamounts to 93,677 million yen.
(11)

Other Important Matters Concerning Current Status of Corporate GroupThe Company is in negotiations with some automakers for compensation regarding
violation of antitrust law in the Automotive segment.

2.

Information Concerning Shares (as of March 31, 2021)(1)

Total Number of Authorized Shares
3,000,000,000 shares(2)

Total Number of Issued Shares
793,940,571 shares (compared with the end of preceding fiscal year: no increase or
decrease)(3)

Number of Shares for One Unit of Shares
100 shares(4)

Number of Shareholders
65,469 persons (compared with the end of preceding fiscal year: increase of 4,123
persons)(5)

Largest Shareholders (top 10 shareholders)Name of the Shareholder

The Master Trust Bank of Japan, Ltd. (trust account)
Custody Bank of Japan, Ltd. (trust account)
Nippon Life Insurance Company
NORTHERN TRUST CO. (AVFC) RE SILCHESTERINTERNATIONAL INVESTORS INTERNATIONALVALUE EQUITY TRUSTSUMITOMO LIFE INSURANCE COMPANY
Custody Bank of Japan, Ltd. (trust account 4)
The Master Trust Bank of Japan, Ltd. (trust account J)
STATE STREET BANK WEST CLIENT-TREATY
505234NORTHERN TRUST CO.(AVFC) RE U.S. TAXEXEMPTED PENSION FUNDS
Custody Bank of Japan, Ltd. (trust account 5)
Total

Number of
Shares Held

Shareholding
Percentage

in thousands ofshares%84,03357,13924,703

10.77
7.32
3.17

16,177

2.07

15,556
14,472
12,590

1.99
1.86
1.61

11,243

1.44

10,613

1.36

10,581

1.36

in thousands ofshares%257,11132.96(Notes)1.
SUMITOMO LIFE INSURANCE COMPANY, in addition to what is set forth in the table
above, has established a trust for retirement benefits holding 8,000 thousand shares(a 1.03% shareholding) in the Company, and has retained the authority to give
instructions to exercise voting rights.
2.
NEC Corporation holds 6,914 thousand shares in the Company. Also, NEC
Corporation has established a trust for retirement benefits holding 6,900 thousand
shares (a 1.77% shareholding as combined with the above NEC Corporation’s
holding) in the Company, and has retained the authority to give instructions toexercise voting rights.

3.

Shareholding percentages have been calculated after deducting from the total
number of issued shares the 13,861,199 of its own shares that the Company holds.

3.

Matters Related to Officers of the Company(1)

Name, etc. of Directors and Audit & Supervisory Board Members (as of March
31, 2021)
Name

Position and Areas of Responsibility

Important Concurrent Post

※Masayoshi Matsumoto Chairman of the Board of Directors

Chairman, Kansai Economic
Federation※Osamu Inoue※Mitsuo Nishida

President

Executive Vice President
General Manager, Automotive
Business Unit

※Nozomi Ushijima

Executive Vice President
General Manager, Advanced
Materials Business Unit
Electronics Group (Fine Polymer
Division, Water Processing Division)※Yoshitomo Kasui

Senior Managing Director
Corporate Staff Group(Compliance & Risk Management,
Administration, Tokyo
Administration, Secretary, Human
Resources, Human Resources
Development, Internal Auditing)※Akira Nishimura

Senior Managing Director
General Manager, R&D Unit
Electronics Group (Flexible Printed
Circuits Division)※Hideo Hato

Senior Managing Director
General Manager, New Business
Development Unit
Deputy General Manager,
Automotive Business Unit
(Systems & Electronics Division)
Corporate Staff Group (Legal, Public
Relations, Corporate Planning,
Intellectual Property, Security Trade
Control)
Environment and Energy Group(Energy System Division)

Masaki Shirayama

Managing Director
General Manager, Electric Wire &Cable, Energy Business Unit

Chairman of Board of Directors,
Sumitomo Wiring Systems, Ltd.
Chairman of the Board, Sumitomo
Electric Wiring Systems, Inc.
Joint Representative Director,
Kyungshin Co., Ltd.
Director, Sumitomo Electric
Hardmetal Corp.
Director, Sumitomo Electric
Sintered Alloy, Ltd.

Name

Position and Areas of Responsibility

Important Concurrent Post

Nobuyuki Kobayashi

Managing Director
Corporate Staff Group (Accounting,
Finance, Information Systems,
Procurement, Logistics
Management)

Director, Sumitomo Rubber
Industries, Ltd.

Hiroshi Sato

Director

Advisor, Kobe Steel, Ltd.
President & Representative
Director, The Kobe International
House Inc.

Michihiro Tsuchiya

Director

Director, RaQualia Pharma Inc.

Christina Ahmadjian

Director

Professor, Graduate School ofBusiness Administration,
Hitotsubashi University
Director, Japan Exchange Group,
Inc.
Director, Mitsubishi Heavy
Industries, Ltd.
Director, Asahi Group Holdings, Ltd.

Satoru Ogura

Audit & Supervisory Board Member(full-time)

Akira Hayashi

Audit & Supervisory Board Member(full-time)

Katsuaki Watanabe

Audit & Supervisory Board Member

Director, Kyushu Financial Group,
Inc.

Michiko Uehara

Audit & Supervisory Board Member

Attorney at law
Audit & Supervisory Board Member,
The Japan Wool Textile Co., Ltd

Ikuo Yoshikawa

Audit & Supervisory Board Member

Certified public accountant(Notes)1.
Directors marked with “※” are Representative Directors.
2.
Among the Directors above, Mr. Hiroshi Sato, Mr. Michihiro Tsuchiya and
Ms. Christina Ahmadjian are not only Outside Directors under Article 2, Item 15 of theCompanies Act, but also Independent Officers under the rules of Tokyo Stock
Exchange, Inc., etc.
3.
Among the Audit & Supervisory Board Members above, Mr. Katsuaki Watanabe,
Ms. Michiko Uehara and Mr. Ikuo Yoshikawa are not only Outside Audit & Supervisory
Board Members under Article 2, Item 16 of the Companies Act, but also Independent
Officers under the rules of Tokyo Stock Exchange, Inc., etc.
4.
Mr. Akira Hayashi, an Audit & Supervisory Board Member, having years of experiencein the Accounting and Finance Division of the Company, has a distinguished level ofknowledge of finance and accounting.
Mr. Ikuo Yoshikawa, an Audit & Supervisory Board Member, qualified as a certified
public accountant, has a distinguished level of knowledge of finance and accounting.

5.

As of June 25, 2020, Mr. Junji Itoh (Managing Director) resigned from his director
position due to expiration of his term of office.
The position in parentheses is as of his resignation.

(2)

Remuneration, etc. of Directors and Audit & Supervisory Board Members(i)

Total Amounts of Remuneration, etc. of Directors and Audit & Supervisory Board
Members

Position of
Officers
Directors
Audit &
Supervisory
Board
Members

Total Amount of
Remuneration,etc.

Total Amount by Type ofRemuneration, etc.
Fixed
PerformanceRemuneration
based Bonuses

Number ofTargetOfficers

735,370,000 yen

605,370,000 yen

130,000,000 yen

13

115,950,000 yen

115,950,000 yen-

5(Notes)1.
The number of officers above includes one Director who resigned as of June25, 2020.
2.
The amount of remuneration for Directors shown above includes the amountof a bonus payment of 130 million yen if a resolution regarding the payment ofa bonus to the Directors is adopted as proposed at the 151st General Meetingof the Shareholders.
(ii)

Policy for Determining Remuneration, etc., and Similar Matters

The Company has established a policy for determining individual remuneration, etc.,
for Directors and when determining these issues, they are discussed at the Compensation
Advisory Committee, which is chaired by an Outside Director and a majority of the membersof which are Outside Officers, and based on the content reported to the Board of Directors,
they are adopted by resolutions of the Board of Directors. The specific content of the policy
is as follows.
For determining Directors’ remuneration, etc., based on the Sumitomo Spirit and theSumitomo Electric Group Corporate Principles, we will maintain a firm stance on our
universal basic policy of contributing to society through fair business activities and havedesigned a remuneration structure whereby we provide incentives for Directors making theCompany Group grow sustainably and improving our corporate value in the mid- and longterm.
a.

b.

Composition of Remuneration for Directors
Remuneration for Directors is composed of monthly remuneration and bonus.

Policy for Determining Monthly Remuneration
Regarding monthly remuneration, a monthly remuneration table for each post is set
based on each post’s role and degree of responsibility as well as on the extent of theircontribution to the Company’s performance, after ensuring the objectivity of the standards ofremuneration by utilizing third party analysis of officers’ remuneration covering corporations
similar to the Company in areas such as the business contents and scale. The amount in
the table adopted for each person is determined upon consideration of the Director’s role,
degree of responsibility, scale, complexity and difficulty of the area of which the Director is incharge as well as on the extent of their contribution to the Company’s performance also witha mid- and long-term perspective. The total amount of monthly remuneration for Directors isdetermined within the framework of the remuneration amount resolved at the shareholders’meeting.
c.

Policy for Determining Bonuses and Content of Performance Indicators
The Directors’ bonuses shall be performance-based bonuses, and their total amountis subject to the annual shareholders’ meeting resolution and determined comprehensively
considering the Company’s performance in each fiscal year, particularly items such as
dividend levels, in addition to net sales, operating income, ROIC, and the profit for the year,
which are taken seriously by the Company in its management strategy, after ensuring theobjectivity of the standards of remuneration by utilizing third party analysis of officers’
remuneration covering corporations similar to the Company in areas such as the business
contents and scale. The allocation for each Director is set at a standard that provides
incentives for each Director and in consideration of a mid- and long-term perspective andtaking into account the Director’s post, degree of responsibility, achievement of the main
goals in the department or division for which they are responsible (items such as net sales,
each profit index, and ROIC), their contribution to the Company’s performance each fiscal
year, and qualitative factors such as qualifications necessary to achieve them. The
Company does not pay bonuses to Outside Directors from the viewpoint of ensuring
independence.
[Indicators, Goals, Results, etc., Related to Performance-based Bonuses]
The goals and results of indicators related to performance-based bonuses during thisfiscal year are as shown in the following table.
Indicators
Operating
IncomeMarginOrdinary
Income(millionsof yen)ProfitAttributable to
Owners of the
Parent(millions ofyen)

55,0002.0%

48,00010,000--2,800,000

70,0002.5%

61,00015,0002.9%

1.0%

2,918,580

113,926

3.9%

114,072

56,3444.6%

3.6%

Net Sales(millions ofyen)Operating
Income(millionsof yen)Goals (atthebeginningof the year)

2,750,000

Goals (ininterim)Results

Entry

ROIC

ROE

(Notes)Regarding the values stated as goals, those (at the beginning of the year) are in the
consolidated performance forecast at the time of announcing the settlement in thefirst quarter for the fiscal year ended in March 2021 and those (in interim) are in the
consolidated performance forecast revised at the time of announcing the settlement in
the second quarter for the fiscal year ended in March 2021.
d.

Policy for Determining Ratio of Monthly Remuneration and Bonuses
The ratio of monthly remuneration and bonuses is not established, and changes due
to performance goals, individual evaluation, etc. as set forth in paragraph c. above.
Furthermore, the payment ratio of monthly remuneration and bonuses is approximately
1:0.25-0.5 in the results for past few years.

e.

Procedure for Determining Remuneration
Regarding the procedure for determining monthly remuneration and bonuses,
important matters such as the policy for their determination, the establishment and revision or
abolition of related internal rules, etc., and the specific amounts of individual monthly
remuneration and bonuses based on performance evaluations are discussed at theCompensation Advisory Committee from an objective perspective. The Board of Directors
will discuss and determine the policy for their determination thereof, and establishment andrevision or abolition of related internal rules based on the report from the Compensation
Advisory Committee, and will determine agenda items for the total amounts of bonuses andmonthly remuneration for each fiscal year to be proposed in the shareholders’ meeting if itreconsiders the cap on their total amounts. The specific amounts of individual monthly
remuneration and bonuses and the timing and method of payment thereof are determined by
the President, as delegated by the Board of Directors, based on the content reported by theCompensation Advisory Committee. Remuneration for Audit & Supervisory Board Members
is determined through discussion among Audit & Supervisory Board Members within theframework of the remuneration amount resolved at the shareholders’ meeting.
[Matters Concerning Delegation Related to Determining Directors’ Individual Remuneration,
etc.]
The approach and method of calculation of Directors’ monthly remuneration andbonuses, and proposed individual amounts based thereon, are discussed by theCompensation Advisory Committee. Based on this report, the Board of Directors approved
the approach and method of calculation of monthly remuneration and bonuses, and adopted
resolutions that the specific amounts and timing and method of payment would be delegatedto the President (Osamu Inoue), who receives an overview of the performance of theCompany as a whole and evaluates each Executive Director. The President decides theamounts of individual monthly remuneration and bonuses in line with the proposal reportedby the Compensation Advisory Committee and based on the content discussed by the Boardof Directors.
[Reasons Why the Board of Directors Meeting Determined that the Content of Remuneration,etc. for Individual Directors in This Fiscal Year Is in Line with the Policy for the Determination]
The individual monthly remuneration and bonus amounts are determined based on
the policy for the determination of Directors’ remuneration after discussions by theCompensation Advisory Committee based on an objective perspective, and the Board of
Directors determined that such amounts are in line with the policy for the determination.
[Shareholders’ Meeting Resolution Regarding Remuneration, etc. for Officers]
Monthly remuneration for Directors is not more than 70,000,000 yen per month (andfor Outside Directors is not more than 6,000,000 yen per month) as resolved at theshareholders’ meeting held on June 24, 2016. The number of Directors at the time was 13(of whom, the number of Outside Directors was two). In addition, with respect to Directors’
bonuses, 150,000,000 yen will be paid in total for ten Directors (excluding three Outside
Directors) as resolved at the shareholders’ meeting held on June 25, 2020. With respect tothe total amount of monthly remuneration for Audit & Supervisory Board Members, theamount of remuneration for five Audit & Supervisory Board Members is not more than
10,000,000 yen per month as resolved at the shareholders’ meeting held on June 27, 2007.
Holding of Company’s Shares
In order to further raise motivation and morale to improve the Company’s
performance and promote management that takes shareholder value seriously, the Company
has set a certain target level and encourages Inside Directors to hold Company’s sharesthrough the officer shareholding association, and Inside Directors continue to hold theCompany’s shares during their term of office.
f.

(3)

Matters Concerning Outside Officers(i)Relationships Between the Company and Important Companies, etc. at Which
Positions are Concurrently Held by Officers of the Company (Concurrent Positions as
Executives or Outside Officers, etc. at Other Companies, etc.)
Position

Name

Hiroshi Sato

Michihiro Tsuchiya

Director

Christina Ahmadjian

Audit &
Supervisory
Board
Members

Katsuaki WatanabeMichiko Uehara

Company, etc. at which
Positions are Concurrently
Held by Officers of theCompany and Content
President & Representative
Director, The Kobe
International House Inc.
Outside Director, RaQualia
Pharma Inc.
Professor, Graduate School ofBusiness Administration,
Hitotsubashi University
Outside Director, Japan
Exchange Group, Inc.
Outside Director, Mitsubishi
Heavy Industries, Ltd.
Outside Director, Asahi Group
Holdings, Ltd.
Outside Director, Kyushu
Financial Group, Inc.
Outside Audit & Supervisory
Board Member, The Japan
Wool Textile Co., Ltd

RelationshipNo particular
relationship.
No particular
relationship.
No particular
relationship.
No particular
relationship.
No particular
relationship.
No particular
relationship.
No particular
relationship.
No particular
relationship.

(Note) The information under the heading “Company, etc. at which Positions are
Concurrently Held by Officers of the Company and Content” is as of March 31, 2021.

(ii)Main Activity Status
Position

Name

HiroshiSato

Director

Michihiro
Tsuchiya

Main Activity Status
He attended all 15 Board of Directors meetings held this fiscal
year. He makes statements, as necessary, on corporate
management in general, based on his rich experience and his
extensive knowledge as a manager of a corporation with wide
ranging business areas, such as materials like iron and steel,machines and energy. In addition, other than the above, heserves as a Chairman of both the Nominating Advisory
Committee and the Compensation Advisory Committee andattended all five respective meetings of the committees held
this fiscal year and led the operation and made statements
regarding the approach, etc. to personnel appointments andtraining plans of Officers and Officers’ remuneration from an
independent and objective position. Furthermore, regarding
compliance, he reviews and expresses opinions on internal
control systems and specific measures, responding tochanges in global regulations, etc. and misconduct by othercompanies, on a routine basis. Particularly, he is making
statements on the improvement and enhancement of thecompetition law compliance system for the entire group andhow to ensure its effectiveness, with respect to theeradication and prevention of the reoccurrence of violations ofantitrust law, including foreign competition law.
He attended all 15 Board of Directors meetings held this fiscal
year. He makes statements, as necessary, on corporate
management in general, based on his rich experience and his
extensive knowledge as a manager of a corporation
developing global business activities. In addition, other than
the above, he serves as a member of both the Nominating
Advisory Committee and the Compensation Advisory
Committee and attended all five respective meetings of thecommittees held this fiscal year and made statements
regarding the approach, etc. to personnel appointments andtraining plans of Officers and Officers’ remuneration from an
independent and objective position. Furthermore, regarding
compliance, he reviews and expresses opinions on internal
control systems and specific measures, responding tochanges in global regulations, etc. and misconduct by othercompanies, on a routine basis. Particularly, he is making
statements on the improvement and enhancement of thecompetition law compliance system for the entire group andhow to ensure its effectiveness, with respect to theeradication and prevention of the reoccurrence of violations ofantitrust law, including foreign competition law.

Position

Director

Audit &
Supervisory
Board Members

Name

Main Activity Status

Christina
Ahmadjian

She attended all 15 Board of Directors meetings held thisfiscal year. She makes statements, as necessary, mainly on
methods relating to the governance system of the wholegroup and points for attention of global management
strategies, etc., based on her extensive knowledge as aprofessor of a university whose main research fields arecorporate management and corporate governance and global
perspective. In addition, other than the above, she serves
as a member of both the Nominating Advisory Committee andthe Compensation Advisory Committee and attended all threerespective meetings of the committees which were held thisfiscal year on and after she was placed as the member andmade statements regarding the approach, etc. to personnel
appointments and training plans of Officers and Officers’
remuneration from an independent and objective position.
Furthermore, regarding compliance, she reviews andexpresses opinions on internal control systems and specificmeasures, responding to changes in global regulations, etc.
and misconduct by other companies, on a routine basis.
Particularly, she is making statements on the improvement
and enhancement of the competition law compliance system
for the entire group and how to ensure its effectiveness, withrespect to the eradication and prevention of the reoccurrenceof violations of antitrust law, including foreign competition law.

Katsuaki
Watanabe

He attended all 15 Board of Directors meetings and all 17
Audit & Supervisory Board meetings held this fiscal year. He
makes statements, as necessary, mainly on methods forviable business management for the whole group, andstatements on measures responding to changes in global
regulations, etc., misconduct by other companies, and points
for attention, etc. concerning corporate governance, based on
his rich experience in and extensive knowledge of corporate
management in general, acquired by engaging inmanagement of corporations developing global operations.
In addition, other than the above, he serves as a member ofboth the Nominating Advisory Committee and theCompensation Advisory Committee and attended all fiverespective meetings of the committees which were held thisfiscal year and made statements regarding the approach, etc.
to personnel appointments and training plans of Officers andOfficers’ remuneration from an independent and objective
position. Furthermore, regarding compliance, he reviewsand expresses opinions on internal control systems andspecific measures in cooperation with other Audit &Supervisory Board Members, on a routine basis.
Particularly, he is making statements on the improvement andenhancement of the competition law compliance system forthe entire group and its thoroughness and organization withrespect to the eradication and prevention of the reoccurrenceof violations of antitrust law, including foreign competition law.

Position

Name

Main Activity Status

Michiko
UeharaShe attended 14 out of 15 Board of Directors meetings and
16 out of 17 Audit & Supervisory Board meetings held thisfiscal year. She makes statements, as necessary, mainly on
business management, including risk management,
measures responding to changes in global regulations andmisconduct by other companies, and points for attention, etc.
concerning corporate governance, based on her expertiseand experience as an attorney at law and great insight intorisk and crisis management, etc., including compliance bycorporations. Furthermore, regarding compliance, shereviews and expresses opinions on internal control systems
and specific measures in cooperation with other Audit &Supervisory Board Members, on a routine basis.
Particularly, she is making statements on the improvement
and enhancement of the competition law compliance system
for the entire group and its thoroughness and organization
with respect to the eradication and prevention of thereoccurrence of violations of antitrust law, including foreigncompetition law.

Ikuo
Yoshikawa

He attended all 15 Board of Directors meetings and all 17
Audit & Supervisory Board meetings held this fiscal year. He
makes statements, as necessary, mainly on business
management, including risk management, measures
responding to changes in global regulations, etc. andmisconduct by other companies, and points for attention, etc.
concerning corporate governance, based on his expertiseand experience as a certified public accountant and his
extensive knowledge as a professor of a university whose
main research field is accountancy. Furthermore, regarding
compliance, he reviews and expresses opinions on internal
control systems and specific measures in cooperation withother Audit & Supervisory Board Members, on a routine
basis. Particularly, he is making statements on the
improvement and enhancement of the competition law
compliance system for the entire group and its thoroughness
and organization with respect to the eradication andprevention of the reoccurrence of violations of antitrust law,
including foreign competition law.

Audit &
Supervisory
Board Members(iii)

Outline of Contents of Limited Liability Contract

The Company has entered into limited liability contracts with all of the Outside
Directors and the Outside Audit & Supervisory Board Members in accordance with theprovisions of the Articles of Incorporation. An outline of the contents of the limited liability
contracts is as follows:
With respect to the liability under Article 423, Paragraph 1 of the Companies Act, theOutside Director or the Outside Audit & Supervisory Board Member shall assume liability fordamages limited to the higher amount of either 10 million yen or the minimum liability amountunder Article 425, Paragraph 1 of the Act, if he was without knowledge and not grossly
negligent in conducting his duties.

(iv)Total Amount of Remuneration, etc.
Three Directors and three Audit & Supervisory Board Members: 111,600,000 yen

4.

Matters Regarding Accounting Auditor(1)

Name of Accounting Auditor
KPMG AZSA LLC(2)Amount of Remuneration, etc. to Accounting Auditor(i)Amount of remuneration, etc. to be paid by the Company

165 million yen(ii)

Total amount of money and other financial benefits to be paid by
the Company and its subsidiaries

754 million yen(Notes)1.
As a result of examining items such as the details of the audit plans for this fiscal year, theaudit results of the previous fiscal year, and the basis for calculating estimates on which
remuneration is based, the Audit & Supervisory Board determined that the remuneration
amount of the Accounting Auditor was appropriate. Therefore, the Audit & Supervisory Board
gave consent regarding Article 399, Paragraph 1 of the Companies Act.
2.
Under the audit contract concluded between the Company and the Accounting Auditor, theamount of remuneration, etc. for audits as per the Companies Act and the amount of
remuneration, etc. for audits as per the Financial Instruments and Exchange Act are not andcannot practically be separated. Therefore, the total of these amounts is shown in (i) above.
3.
The Company pays to the Accounting Auditor compensation for services (i.e., support services
relating to preparation of the integrated report, etc.), other than the services set forth in Article
2, Paragraph 1 of the Certified Public Accountants Act.
4.
Among the important subsidiaries of the Company specified in “1.(9) Status of Important
Subsidiaries and Affiliates”, overseas subsidiaries are subject to audits (limited to the types ofaudit set forth in the Companies Act or the Financial Instruments and Exchange Act and theirforeign equivalents) by certified public accountants or audit firms (including persons withqualifications in foreign countries that are equivalent to these qualifications) other than the
Accounting Auditor of the Company.

(3)

Policy for Determination of Dismissal or Non-Reappointment of Accounting
AuditorIt is the Company’s policy that if any of the Items of Article 340, Paragraph 1 of theCompanies Act applies to the Accounting Auditor, the Company will dismiss the Accounting
Auditor. In addition, in any other circumstances where it is reasonably suspected that the
Accounting Auditor cannot ensure fairness in implementing its duties and, therefore, it isdeemed inappropriate for the Accounting Auditor to continue auditing, the Company will
either dismiss or refuse to reappoint the Accounting Auditor, depending on thecircumstances.

5.

Content of Resolutions Regarding Development of Systems Necessary to
Ensure the Propriety of Operations and Outline of the Operational Status of the
Systems

In accordance with Article 362, Paragraph 4, Item 6 of the Companies Act and Article
100, Paragraphs 1 and 3 of the Ordinance for Enforcement of the Companies Act, theCompany, at its Board of Directors meeting, adopted a resolution concerning development ofsystems necessary to ensure the propriety of operations of a stock company (basic policies
regarding establishment of an internal control system), with the following content. In
addition, the operational status of the systems is outlined as follows.
I.

Content of Resolutions Regarding the Basic Policies to Establish the Internal
Control Systems(1)

Systems for Preservation and Management of Information Related to the
Execution of Duties by Directors

The Company shall produce and keep the minutes of Board of Directors meetings,
and shall record and appropriately manage information regarding the execution of duties andmaking of decisions by Directors, such as an internal document for drafting proposals andmaking internal approvals, as set forth in the internal rules of information management, theinternal rules of document handling and the internal rules of papers preservation.
(2)

Internal Rules and Other Systems for Managing Risk of Loss

Regarding major cross-Group risks such as those related to disaster, quality, safety,
environment, credit extension and export and import trade controls, risk management shallbe conducted by each department or division. Each department or division shall assess therisks pertaining to implementation of the business it controls pursuant to the responsive
measures and accident examples and preventative measures which are shared within theGroup either by the Corporate Staff Group which is responsible for each risk or by thecommittees hosted by Directors, etc. (meaning the “Executive Directors or Executive
Officers”; hereinafter the same) who are in charge of the Corporate Staff Group.
Regarding pressing issues such as bribery prevention which is increasingly importantin conjunction with global business development, as well as cyber security, measures relating
to infectious diseases, management of confidential information and personal information, andlegal, labor and tax issues, the Company intends to develop systems and reinforce its
commitments through cooperation among relevant departments and divisions under the
initiative of the Risk Management Committee.
Further, regarding risks peculiar to a specific department or division, the relevant
department or division shall decrease risks by, as deemed necessary, obtaining theassistance of the Corporate Staff Group having expertise and external experts.
The Risk Management Committee shall exercise control over these activities
pursuant to the internal rules of risk management, and shall monitor them in cooperation with
the Audit & Supervisory Board Members, the Internal Auditing Department and the Corporate
Staff Group which is responsible for each risk.
Further, if any material risk becomes evident and countermeasures urgently need tobe taken, the Risk Management Steering Committee shall, among other things, assess theseverity of the crisis and establish a task force.
(3)

Systems for Ensuring the Efficiency of the Execution of Duties by Directors

In order to ensure efficient and appropriate execution of duties by Directors, etc. andadministrative members the Company shall set forth, in the job classification system and theinternal rules of operations, (i) the department or division in charge, (ii) the authority vested ineach role, and (iii) the operations governed by each organization.

Further, the Company shall adopt the Executive Officer System and the Business Unit
System, and develop a system in which each Business Unit, the Sales & Marketing Unit andthe R&D Unit will do business flexibly under the supervision of each General Manager of theUnit depending on environmental changes and customer demands.
Further, regarding the operational results, etc. of each Business Unit, the Company
will develop a mid-term plan and an annual plan designed to achieve the mid-term plan, andadopt a system under which the Accounting and Finance Department and the Director in
charge of accounting and finance shall track and analyze the progress toward achievement
on a monthly basis, and shall report the results to the Management Conference and theBoard of Directors in order to examine what measures might need to be taken.
The Company shall promote the use of video conference and computer andcommunication network systems, aiming to efficiently gather, analyze, utilize and share
management information.
(4)

Systems for Ensuring that the Execution of Duties by Directors and Employees
Is Compliant with Laws and the Articles of Incorporation

The Company shall endeavor to spread the Charter of Corporate Behavior, which
elaborates the Sumitomo Spirit and the Corporate Principles, and the Code of Conduct,
which provides the Group’s common rules on compliance. Further, the Company shallthoroughly implement the principle that compliance with laws and maintenance of corporate
ethics constitute the foundation of management, through the statements and behavior of the
top management.
The Compliance Committee chaired by the President shall, among other things, dothe following: identify and analyze cross-Group compliance risks; confirm the disseminationand firm establishment of the Code of Conduct; plan and perform training; investigate thecause of violations and formulate proposed measures to prevent their reoccurrence;
disseminate and have the above items thoroughly implemented within the Group; andconduct monitoring of the compliance promotion activities.
Meanwhile, each department and division shall identify and analyze compliance risks,
including risks peculiar to the department or division, and take measures to prevent them;whereas the Compliance Committee, the Legal Department, the Audit & Supervisory Board
Members and the Internal Auditing Department shall conduct their monitoring, in cooperation
with one another.
Regarding compliance with domestic and foreign competition laws, the Company
shall continuously provide education regarding competition laws in order to eradicate any
cartel or bid-rigging activities, including suspicious activities, within the Group. Further,under the Compliance Committee, the Compliance & Risk Management Office shall monitor
the status of operation of, and compliance with, a set of rules and regulations to ensurecompliance with competition laws and, further, plan and implement any other competition
compliance measures, in cooperation with the respective dedicated organization of each Unit
or Compliance Liaison.
Further, the Compliance Committee shall appropriately identify the circumstances
pertaining to information provided to the notification and consultation desk established within
and without the Company, and shall take necessary measures.

(5)Systems for Ensuring the Propriety of Financial Reporting

The Company shall establish an Internal Control Committee for Financial Reporting,chaired by the President, and shall also build a promotion organization in the Corporate Staff
Group. Pursuant to their policies, guidance and assistance, each department, division andsubsidiary shall proceed with the development and appropriate operation of the internal
control system in accordance with the Financial Instruments and Exchange Act, as well aswith the assessment and audit standards and implementation standards set forth by the
Financial Services Agency, in order to further enhance the Company’s system for ensuring
the propriety of financial reporting. The Internal Auditing Department shall assess theeffectiveness of the internal control system of the whole Group for each fiscal year, andcompile an internal control report to be submitted to the Financial Services Agency based on
the results of such assessment and shall obtain the approval of the Internal Control
Committee for Financial Reporting and the Board of Directors.
(6)

Systems for Ensuring the Propriety of the Operations Performed by the
Corporate Group Comprised of the Company and the Subsidiaries

The Company shall also endeavor to spread the Charter of Corporate Behavior,
which elaborates the Sumitomo Spirit and the Corporate Principles, to the Group companies,
aiming to share with them the principles that should be respected and complied with in thecourse of business operations.
Pursuant to the internal rules of affiliated companies management, the Company shallreceive reports from subsidiaries or have subsidiaries consult with the Company as deemednecessary, regarding matters to be decided and accrued facts to be reported or referred to
the Management Conference and the Board of Directors meeting of the Company, andcertain matters related to risk management and compliance, etc.
In addition, the related persons of the governing Unit and the administrative membersof the Accounting and Finance Department, among others, shall assume the offices of
Directors and Audit & Supervisory Board Members of the subsidiaries in order to track their
management status. Furthermore, information regarding risk management and compliancesystems, etc. shall be exchanged at the conference of Audit & Supervisory Board Membersof the Group, or through communication and exchanges between the Corporate Staff Groupof the Company, such as the Human Resources Division, the Administration Division and the
Accounting and Finance Department, on the one hand, and the relevant departments ordivisions of the subsidiaries, on the other hand. In this regard, the major activities relating torisk management and compliance do not only cover the Company itself, but also its domestic
and foreign subsidiaries, excluding listed companies and their subsidiaries.
Regarding major cross-Group risks, each subsidiary shall practice risk managementby assessing the risks pertaining to the implementation of its business, pursuant to the
responsive measures and accident examples and preventative measures shared within theGroup by each department or division of the Company in charge, among others. Further,each subsidiary shall minimize risks peculiar to itself, by obtaining the assistance of theCompany.
Regarding compliance risks, too, the Company has adopted a system under which
each subsidiary takes measures, including those to cope with its peculiar risks, pursuant to
the major compliance risks and measures to prevent their occurrence shared within theGroup by the Compliance Committee and the Legal Department of the Company, among
others. With respect to the notification and consultation desk for whistle-blowing, theCompany guides each subsidiary to establish its own internal consultation desk, whereas theCompany also maintains the Group’s common external consultation desks, both in Japanand abroad.
Under the current system, the business of each subsidiary is operated flexibly underthe Business Unit System. Under this system, the business plan of each subsidiary is
formulated as part of the mid-term plan and annual plan of each Unit, and the operational
results of each Unit are reported to the Management Conference and the Board of Directors
on a monthly basis, in order to examine measures required to be taken. Further, utilizationof the Group’s common infrastructure has also been promoted in regard to the utilization ofcomputer and telecommunication systems, etc. at subsidiaries.
(7)

Matters Related to the Employees to Provide Support to the Audit &Supervisory Board Members and Matters for Ensuring their Independence from
Directors and the Effectiveness of Instructions to Such Employees

The Company shall establish the Office of Audit & Supervisory Board Members as a
dedicated office to provide support to the Audit & Supervisory Board Members and shallallocate employees to such tasks (the “staff of Office of Audit & Supervisory Board
Members”), some of whom shall be dedicated staff members. Personnel transfer andpersonnel evaluation of the staff of Office of Audit & Supervisory Board Members shall be
subject to prior consultation with the Audit & Supervisory Board for their opinions, and thestaff of Office of Audit & Supervisory Board Members shall follow the directions andcommands of the Audit & Supervisory Board Members.
(8)

Systems for Reporting by Directors and Employees of the Company, Directors
and Employees of the Subsidiaries, or Persons Who Have Received Reports
therefrom to the Audit & Supervisory Board Members of the Company andOther Systems for Reporting to the Audit & Supervisory Board Members of theCompany

Audit & Supervisory Board Members shall attend various important meetings whichgovern the operation of the Company’s whole Group, such as the Management Conference,
the Risk Management Committee and the Compliance Committee. Further, the Company
shall adopt a system under which the Directors, the senior managers of the departments ordivisions, the presidents of the subsidiaries and others shall report to the Audit & Supervisory
Board Members, as deemed necessary, regarding matters which occur within the Groupsuch as sudden and unexpected acts violating laws or the Articles of Incorporation, ormaterial execution of business or change to internal control system (excluding minor ones).
(9)

Systems for Ensuring That a Person Who Has Made a Report to the Audit &Supervisory Board Members Shall Not Be Unfavorably Treated on Account ofHaving Made Such a Report

The Company and each subsidiary shall refrain from unfavorably treating any person
who has made a report to the Audit & Supervisory Board Members as set forth in paragraph(8) above on account of having made such a report, by taking such measures as setting forthin their internal rules for whistle-blowing desk system that they shall not dismiss or otherwise
unfavorably treat a person on account of such person having provided information to the staffof Office of Audit & Supervisory Board Members.

(10)Matters Related to Policies Regarding Accounting for the Costs or Debts
Incurred in Relation to Execution of Duties of the Audit & Supervisory Board
Members

For each fiscal year, a necessary budget shall be set with the approval of the Audit &Supervisory Board Members in order to account for costs or debts incurred in relation to
execution of duties of the Audit & Supervisory Board Members, and a prompt response shallbe made if an Audit & Supervisory Board Member requests reimbursement for costs having
been prepaid or disbursed, or repayment of debts having been borne, by such Audit &Supervisory Board Member.
Further, costs incurred in the case where the Audit & Supervisory Board Members
consult with external experts, such as lawyers and certified public accountants, in relation to
execution of their duties shall be borne by the Company.
(11)

Other Systems for Ensuring that the Audit & Supervisory Board Members Can
Conduct Audits Effectively

The Company shall, as deemed necessary, secure opportunities for the Audit &Supervisory Board Members to interview Directors and the senior managers of thedepartments or divisions, and shall also periodically hold meetings for the Audit &Supervisory Board Members and Outside Directors to exchange opinions with, among
others, the Chairman of the Board of Directors, the President and the Officers in charge of
the Corporate Staff Group concerning important audit matters. Furthermore, the Internal
Auditing Department shall act in cooperation with the Audit & Supervisory Board Members.
II

Outline of Operational Status(1)

Systems for Preservation and Management of Information Related to the
Execution of Duties by Directors

The minutes of Board of Directors meetings are produced each time a meeting isheld, and the originals, to which the officers who attend the meeting affix their names andseals, are kept at the Administration Division. Each department or division manages the
documents and electronic data regarding the execution of duties and making of decisions by
Directors, such as an internal document for drafting proposals and making internal approvals,
as set forth in the internal rules of information management, the internal rules of document
handling and the internal rules of papers preservation.
(2)

Internal Rules and Other Systems for Managing Risk of Loss

Meetings of the Risk Management Committee are held at the same time as meetingsof the Management Conference. Directors, etc. report matters such as the appearance ofmaterial risks in the department or division for which they are responsible, and discuss topics
such as measures against those risks as necessary.
Major cross-Group risks are handled in accordance with the basic policies. Eachdepartment or division manages risks by reassessing the risks pertaining to implementationof the business it controls, following the responsive measures and accident examples andpreventative measures which are shared within the Group either by the Corporate Staff
Group which is responsible for each risk or by the committees hosted by Directors, etc. who
are in charge of the Corporate Staff Group. Further, regarding risks unique to a specificdepartment or division, the relevant department or division decreases risks by, as deemednecessary, obtaining the assistance of the Corporate Staff Group and external experts.

Regarding pressing issues, the Company is arranging a system corresponding to the
EU General Data Protection Regulation regarding personal information management andoffering training to personal information managers appointed for each of the Group’s
departments or divisions and subsidiaries. Also, the Company strives to reinforce
development of cyber security through cooperation among relevant departments anddivisions under the initiative of the Risk Management Committee to deal with the increase
and sophistication of cyber-attacks. In addition, regarding the spread of COVID-19, under
the company-wide task force headed by the President, the Company is working on theimplementation of measures to prevent viral infections and measures to respond to an
infectious outbreak, accurate identification of information including supply chains and thepromotion of measures that ensure business continuity, among other things.
The Risk Management Committee and its secretariat, the Compliance & Risk
Management Office, monitor these activities in cooperation with the Audit & Supervisory
Board Members, the Internal Auditing Department, and the Corporate Staff Group which is
responsible for each risk.
(3)

Systems for Ensuring the Efficiency of the Execution of Duties by Directors

In order to ensure efficient and appropriate execution of duties by Directors, etc. andadministrative members, the Company defines, in the job classification system and theinternal rules of operations, (i) the department or division in charge, (ii) the authority vested ineach role, and (iii) the operations governed by each organization. The Company
appropriately revises the contents of the system and rules as necessary.
Further, regarding the operational results, etc. of each Business Unit, the Company
develops a mid-term plan and an annual plan designed to achieve the mid-term plan, and the
Accounting and Finance Department and the Director in charge of accounting and financetrack and analyze the progress toward achievement on a monthly basis, and report theresults to the Management Conference and the Board of Directors in order to examine what
measures might need to be taken.
In order to gather and analyze management information, the Company has
established and utilizes an accounting system that enables prompt and efficient gathering.
(4)

Systems for Ensuring that the Execution of Duties by Directors and Employees
Is Compliant with Laws and the Articles of Incorporation

The Company endeavors to spread the Sumitomo Spirit and the Charter of Corporate
Behavior through measures such as distributing booklets explaining those ideas, andawareness about compliance by distributing the Code of Conduct and conducting training.
Further, the President comments on the importance of the Sumitomo Spirit and thatcompliance with laws and maintenance of corporate ethics constitute the foundation ofmanagement, at opportunities to deliver messages within the Group, such as New Year’s
speeches and in-house newsletters, striving to spread awareness of these ideas.
In fiscal 2020, the Compliance Committee held four meetings and, among otherthings, undertook the following: identified and analyzed cross-Group compliance risks;planned and performed compliance training; and conducted monitoring of the compliancepromotion activities of each department or division. Regarding compliance training, it wasoffered to officers, managers, those who were promoted, and new employees of theCompany, and employees of the subsidiaries.
Regarding compliance with domestic and foreign competition laws, under the Global
Antitrust and Competition Policy, the Company provides education regarding competition

laws, within the Group, including domestic and foreign subsidiaries. Further, theCompliance & Risk Management Office monitors the status of operation of, and compliancewith, a set of rules and regulations to ensure compliance with competition laws incooperation with the respective dedicated organization of each Unit or the Compliance
Liaison.
Regarding prevention of bribery, the Company provides education within the Group,
including domestic and foreign subsidiaries, and the manager in charge of bribery preventionin each department or division operates systems such as a pre-approval system to providing
business entertainment, among others, pursuant to the internal rules on bribery prevention.
The Compliance Committee appropriately identifies the circumstances pertaining to
information provided to the notification and consultation desk established by the Company
and domestic and foreign subsidiaries within and without the Company (law firms andexperts), and takes necessary measures.
(5)

Systems for Ensuring the Propriety of Financial Reporting

Pursuant to the guidance and assistance of the Internal Control Committee forFinancial Reporting and the relevant Corporate Staff Group, each department, division, andsubsidiary has developed and operated the internal control system. The Internal Auditing
Department assesses the effectiveness of the internal control system of the whole Group,compiles an internal control report to be submitted to the Financial Services Agency basedon the results of such assessment and obtains the approval of the Internal Control
Committee for Financial Reporting and the Board of Directors.
(6)

Systems for Ensuring the Propriety of the Operations Performed by the
Corporate Group Comprised of the Company and the Subsidiaries

The Company also endeavors to spread the Sumitomo Spirit and the Charter ofCorporate Behavior to each subsidiary, aiming to share with them the principles that should
be respected and complied with in the course of business operations.
Regarding specific matters pursuant to the internal rules of affiliated companies
management, the responsible Unit and the relevant Corporate Staff Group of each subsidiaryreceive reports and consultation from the subsidiary, and as necessary, refer them to theManagement Conference and the Board of Directors meeting of the Company.
The related persons of the governing Unit and the administrative members of the
Accounting and Finance Department, among others, are placed as Directors or Audit &Supervisory Board Members of the subsidiaries in order to track their management status.
The business plan of each subsidiary is formulated as part of the mid-term plan andannual plan of each Unit, and the operational results of each Unit are reported to theManagement Conference and the Board of Directors on a monthly basis, in order to examine
measures required to be taken.
Regarding commitments to risk management and compliance systems, suchinformation is exchanged at the conference of Audit & Supervisory Board Members of theGroup, or through meetings held by the Corporate Staff Group of the Company, such as the
Human Resources Division, the Administration Division, and the Accounting and Finance
Department, with the relevant departments or divisions of the subsidiaries, and guidance andsupport are conducted by the relevant Corporate Staff Group for each subsidiary. Also, themajor activities relating to risk management and compliance do not only cover the Company

itself, but also its domestic and foreign subsidiaries, excluding listed companies and theirsubsidiaries.
(7)

Systems for Ensuring that the Audit & Supervisory Board Members Can
Conduct Audits Effectively

The Company has established the Office of Audit & Supervisory Board Members as a
dedicated office to provide support to the Audit & Supervisory Board Members and allocatedemployees consisting of one dedicated staff member and four members who hold posts
concurrently elsewhere to such tasks (the “staff of Office of Audit & Supervisory Board
Members”). The Office of Audit & Supervisory Board Members does not fall under the
responsibility of any Directors, etc. in terms of the organization, and the staff of Office of Audit& Supervisory Board Members must follow the instructions of the Audit & Supervisory Board
Members. Regarding personnel transfer and personnel evaluation of the staff of Office ofAudit & Supervisory Board Members, the Company hears the opinions of the Audit &Supervisory Board Members.
Audit & Supervisory Board Members attend various important meetings, such as theManagement Conference, the Risk Management Committee and the Compliance
Committee. The Directors, etc., the senior managers of the departments or divisions, thepresidents of the subsidiaries and others report to the Audit & Supervisory Board Members,
as deemed necessary, regarding material matters of the contents of the various important
meetings that need supplementation.
A necessary budget is set with the approval of the Audit & Supervisory Board
Members in order to account for costs or debts incurred in relation to execution of duties of
the Audit & Supervisory Board Members, and a prompt response is made if an Audit &Supervisory Board Member makes requests such as reimbursement for costs having been
prepaid or disbursed by such Audit & Supervisory Board Member.
The Directors and the senior managers of the departments or divisions hold meetings
upon request from the Audit & Supervisory Board Members and are interviewed about
matters necessary for audits. In fiscal 2020, the President and the Officers in charge of the
Human Resources, the Administration, and the Accounting and Finance held a meeting oncewith the Audit & Supervisory Board Members and Outside Directors to report and exchange
opinions concerning management policies and tasks, etc. Furthermore, the Internal
Auditing Department requests that the Audit & Supervisory Board Members attend reportmeetings regarding the results of audit in each division, department, etc. and hears theopinions of the Audit & Supervisory Board Members. It also acts in cooperation with the
Audit & Supervisory Board Members through activities such as reporting and exchanging
opinions concerning annual audit plans and its results.
End(Note)In this Business Report, all figures have been rounded to the nearest number as stated,
except for the number of shares indicated in units of one thousand shares which have been rounded
down to the nearest number as stated.

(Translation)

Consolidated Balance Sheet(As of March 31, 2021)(Millions of yen)Accounts

AmountCash and time deposits
Trade notes and accounts
receivable

1,729,371
253,668
755,258

Securities

727

Inventories

606,343

Other current assets

115,341

Allowance for doubtful(1,966)

receivables

Non-current assets

Amount(LIABILITIES)(ASSETS)
Current assets

Accounts

1,652,543

Current liabilities

1,008,061

Trade notes and accounts
payable397,439

Short-term debt

310,695

Commercial papers

14,000Current portion of bonds

10,000

Other current liabilities

275,927

Non-current liabilities

481,347

Bonds

94,873Long-term debt

205,113

Deferred tax liabilities

49,998Net defined benefit liabilities

49,589Other non-current liabilities

81,774

Total liabilities

1,489,408

Property, plant and equipment

981,159

Buildings and structures

294,991

Shareholders’ equity

1,531,605

Machinery and equipment

421,617

Common stock

99,737

Land

93,806

Capital surplus

170,875

Construction in progress

62,012

Other

108,733(NET ASSETS)

Retained earnings
Treasury stock
Accumulated othercomprehensive income

1,281,762(20,769)
97,201

Net unrealized holding gains onavailable-for-sale securities

74,866

Investments and other assets

635,152

Deferred gains or losses onhedges(1,419)Investment securities

407,406

Foreign currency translation
adjustments(23,659)

Net defined benefit assets

158,447

Remeasurements of defined
benefit plans

47,413

Deferred tax assets

29,519Other

40,869Allowance for doubtful(1,089) Total net assets

Intangible assets

36,232

receivables
Total assets

3,381,914

Non-controlling interests

Total liabilities and net assets

263,700
1,892,506
3,381,914(Note) Amounts shown in this financial statement have been rounded to the nearest million yen.

Consolidated Statement of Income(From April 1, 2020 to March 31, 2021)(Millions of yen)Accounts

AmountNet sales

2,918,580

Cost of sales

2,387,237

Gross profit

531,343
417,417

Selling, general and administrative expenses
Operating income

113,926

Non-operating income
Interest income
Dividend income
Share of profit of investments
accounted for using the equity method
Other income

918
3,983
12,51911,263

28,683Non-operating expenses
Interest expenses

5,404

Other expenses

23,133

Ordinary income

28,537
114,072

Extraordinary income
Gain on sales of investment securities

16,772

16,772Extraordinary losses
Loss on disposal of property, plant and equipment

2,980

Impairment loss on fixed assets

9,238

Restructuring expenses

8,286

Profit before income taxes

20,504
110,340

Income taxes - current

40,975

Income taxes - deferred

577

41,552

Profit for the year

68,788

Profit attributable to non-controlling interests

12,444

Profit attributable to owners of the parent

56,344(Note) Amounts shown in this financial statement have been rounded to the nearest million yen.

Consolidated Statement of Changes in Net Assets(From April 1, 2020 to March 31, 2021)

Common stock
Balance at beginning ofcurrent period※
Cumulative effect ofchanges in accounting
policyRestated balance
Changes of items during theperiodCash dividends
Profit attributable toowners of the parent for
the year
Purchases of treasury
stock
Disposal of treasury stock
Change of scope of
consolidation
Change in ownershipinterests arising fromtransactions with
non-controllingshareholders
Net changes of items
other than those inshareholders’ equity
Total changes of items
during the period
Balance at end of current
period99,737(Millions of yen)

Shareholders’ equity
Retained
Capital surplus
Treasury stockearnings
170,8811,251,595(20,759)(1,102)
99,737

170,881

1,250,493

Total shareholders’ equity
1,501,454(1,102)(20,759)

1,500,352(24,963)(24,963)

56,34456,344

(0)

(10)

(10)

0

0

(112)

(112)

(6)

(6)

－

(6)

31,269(10)

31,25399,737

170,875

1,281,762(20,769)

1,531,605

Accumulated other comprehensive income
Net
Total
unrealized
NonDeferred
Foreign Remeasure- accumuholding
gains orcurrency
ments of lated other controlling
gains
interests
on translation
definedcompreon available- losses
hedgesadjustments
benefitplans
hensivefor-saleincomesecurities
Balance at beginning ofcurrent period※
Cumulative effect ofchanges in accounting
policyRestated balance
Changes of items during theperiodCash dividends
Profit attributable toowners of the parent for
the year
Purchases of treasury
stock
Disposal of treasury stock
Change of scope of
consolidation
Change in ownershipinterests arising fromtransactions with
non-controllingshareholders
Net changes of items
other than those inshareholders’ equity
Total changes of items
during the period
Balance at end of current
period57,781

57,781

(493)

(493)

(42,327)

1,986(42,327)

1,986

16,947

16,947Total
net assets

248,246

1,766,647(863)(1,965)247,383

1,764,682(24,963)
56,344
(10)
0
(112)

(6)

17,085(926)

18,66845,42780,254

16,317

96,571

17,085(926)

18,66845,42780,254

16,317

127,824

74,866(1,419)(23,659)

47,413

97,201

263,700

1,892,506(Note 1) Balance at beginning of current period marked with "※" was adjusted to reflect the cumulative effects ofchanges in accounting policies. In light of this, after the retrospective application of the changes, the balance at
beginning of current period decreased by ¥183 million in retained earnings.
(Note 2) Amounts shown in this financial statement have been rounded to the nearest million yen.

Notes to Consolidated Financial Statements
1. Basis of Consolidated Financial Statements
1-1. Scope of consolidation(1) Consolidated subsidiaries
Consolidated subsidiaries: 383 companies
Major consolidated subsidiaries
Sumitomo Wiring Systems, Ltd., Sumitomo Electric Device Innovations, Inc., Sumitomo
Riko Co., Ltd., Sumitomo Electric Hardmetal Corp. and Sumitomo Electric Wiring Systems,Inc.
4 companies were newly included in the scope of consolidation as a result of establishment orincrease in materiality from the fiscal year ended March 31, 2021.
And 4 companies were excluded from the scope of consolidation as a result of merger, sales ofshares or completion of liquidation.
(2) Unconsolidated subsidiaries
Major unconsolidated subsidiaries
SEI HR SERVICES, INC.
Reason for being excluded from consolidation
The unconsolidated subsidiaries are immaterial in terms of their assets, sales, profit or loss
and retained earnings, and would not have significant effect on the consolidated financial
statements either individually or collectively.
1-2. Adoption of the equity method(1) Unconsolidated subsidiaries and affiliates accounted for by the equity method
Unconsolidated subsidiaries accounted for by the equity method: none
Affiliates accounted for by the equity method: 32 companies
Major companies accounted for by the equity method
Sumitomo Rubber Industries, Ltd.
1 unconsolidated subsidiary was excluded from the scope of the equity method as a result ofcompletion of liquidation.
(2) Unconsolidated subsidiaries and affiliates not accounted for by the equity method
Major companies not accounted for by the equity method
KINKIDENKI Co.
Reason for not applying the equity method
The unconsolidated subsidiaries and affiliates not accounted for by the equity method are
immaterial in terms of their profit or loss and retained earnings, and would not havesignificant effect on the consolidated financial statements either individually or collectively.

1-3. Significant accounting policies(1) Valuation methods for assets(a) Securities
Held-to-maturity debt securities: stated at amortized cost
Available-for-sale securities
with fair values:
stated at the fair value at the fiscal year end(Unrealized gains and losses, net of related taxes and non-controllinginterests, are recognized as a separate component of net assets.
Acquisition costs on sales are computed using average cost.)
without fair values: stated at average cost(b) Derivatives
Derivative financial instruments are stated at fair value.
(c) Inventories
Inventories are mainly stated at the lower of average cost or net realizable value.
(2) Depreciation method of fixed assets(a) Property, plant and equipment (Excluding Leased assets)
The straight-line method is applied.
(b) Leased assets
Leased assets related to finance leases which do not transfer ownership of the leaseassets and right-of-use assets in consolidated subsidiaries that apply IFRS 16 “Leases”
are depreciated by the straight-line method, assuming the lease period as the useful lifeand no residual value.
(3) Basis for allowance
Allowance for doubtful receivables
The allowance for doubtful receivables is provided based upon estimated uncollectible amounts
for individually identified doubtful receivables and historical loss experience for otherreceivables.
(4) Basis for revenue and expense
The Company and its domestic consolidated subsidiaries have applied “Accounting Standard
for Revenue Recognition” (ASBJ Statement No. 29, March 30, 2018) and “Implementation
Guidance on Accounting Standard for Revenue Recognition” (ASBJ Guidance No. 30, March
30, 2018). The amount expected to be received in exchange for promised goods or services isrecognized as revenue at the time when the control of those goods or services is transferred tothe customer.

(5) Other significant accounting policies(a) Basis for retirement benefits( i ) Method of attributing benefits to periods of service
When calculating retirement benefit obligations, the benefit formula basis is used for
attributing expected retirement benefits to periods of service.
( ii ) Method of expenses for actuarial gains and losses and past service costs
Past service cost is amortized on a straight-line basis over certain periods within the
average remaining service years of employees (mainly 3 years) from the year in which itarises, or accounted for as an expense when it arises.
Actuarial gains and losses are amortized on a straight-line basis over certain periods within
the average remaining service years of employees (mainly 14 years) from the year followingthat in which they arise. It is accounted for as an expense when it arises at someconsolidated subsidiaries.
(b) Accounting for consumption taxes
Transactions subject to consumption taxes are recorded at amounts exclusive ofconsumption taxes.
(c) Adoption of consolidated taxation system
The Company and its wholly owned domestic consolidated subsidiaries have adopted theconsolidated taxation system.
(d) Application of tax effect accounting for the transition from the consolidated taxation system tothe group tax sharing system
Regarding the transition to the group tax sharing system established by the “Act for Partial
Revision of the Income Tax Act etc.,” (Act No. 8 of 2020) and its related review of thetaxation system for a stand-alone entity, in accordance with the paragraph 3 of the“Treatment of Tax Effect Accounting for the Transition from the Consolidated Taxation
System to the Group Tax Sharing System” (PITF No. 39, March 31, 2020), the amounts ofthe deferred tax assets and deferred tax liabilities of the company and its wholly owned
domestic consolidated subsidiaries are based on the tax regulation before this revision
without applying the paragraph 44 of the “Implementation Guidance on Tax EffectAccounting” (ASBJ Guidance No. 28, February 16, 2018).
2. Changes in Accounting Policy(Adoption of IFRS-based accounting treatment by the U.S. consolidated subsidiaries)
Previously, the U.S. consolidated subsidiaries had prepared financial statements in accordance with
U.S. GAAP, and the overseas consolidated subsidiaries excluding the U.S. consolidated subsidiaries
had prepared financial statements in accordance with IFRS. The U.S. consolidated subsidiaries haveadopted IFRS from the beginning of the fiscal year ended March 31, 2021. The main purpose ofthis change is to promote standardization of accounting treatment and to strengthen performance
management by unifying the accounting standards adopted by the overseas consolidated
subsidiaries to IFRS. The changes in the accounting policy have been applied retrospectively.
As a result, due to the cumulative effects on net assets at the beginning of the fiscal year ended
March 31, 2021, the balance at the beginning of current period after the retrospective application
decreased by ¥183 million in retained earnings of the consolidated statement of changes in net
assets.

(Application of Accounting Standards for Revenue Recognition)
The Company and its domestic consolidated subsidiaries have applied “Accounting Standard for
Revenue Recognition” (ASBJ Statement No. 29, March 30, 2018) and “Implementation Guidance on
Accounting Standard for Revenue Recognition” (ASBJ Guidance No. 30, March 30, 2018) from the
beginning of the fiscal year ended March 31, 2021, as they are applicable from the beginning of fiscal
years starting on or after April 1, 2018. The amount expected to be received in exchange forpromised goods or services is recognized as revenue at the time when the control of those goods orservices is transferred to the customer.
The company and its domestic consolidated subsidiaries hereby have changed the time of revenue
recognition of domestic sales transactions from the time of shipment to the time of acceptanceinspection by the customer or arrival at the customer, and also have changed that of export sales
transactions from the time of export customs clearance to the time when risks are transferred to thecustomer on the basis of trade terms such as incoterms. Regarding certain transactions under
repurchase agreements in which the company and its subsidiaries manufacture products from raw
materials purchased from the customer and sell the products to the same customer, the amount ofrevenue recognition have been changed from the gross amount including the purchased price to the
net amount after deducting the purchased price.
In addition, some domestic consolidated subsidiaries identify the delivery of products and theinstallation and on-site adjustment of these products which were previously identified as distinct
transactions as a single performance obligation and recognize revenue at the time of completion of
installation and on-site adjustment. And, regarding contract constructions, the percentage ofcompletion method was previously applied for the constructions for which certain outcome from work
progress was recognizable, and the completed contract method was applied for other constructions.
However, for the performance obligation satisfied over time, the method has been changed andrevenue is recognized over time based on the estimated progress towards the satisfaction of that
performance obligation. For the performance obligation not satisfied over time, revenue is recognizedat the time of the completion of the installation as the performance obligation satisfied at a point intime. If it is possible to measure the outcome of the performance obligation reasonably, the methodof estimating the progress towards the satisfaction of the performance obligation is the input method
based on the ratio of the actual costs to the total estimated costs. If it is not possible to measure theoutcome of performance obligation reasonably, revenue is recognized only to the extent of actual
costs incurred.
The application of the Accounting Standard for Revenue Recognition is in accordance with thetransitional treatment as provided in the proviso of Paragraph 84 of the Accounting Standard for
Revenue Recognition. The cumulative effect of retrospective application is added to or deductedfrom the retained earnings at the beginning of the fiscal year ended March 31, 2021.
As a result, at the beginning of the fiscal year ended March 31, 2021, retained earnings decreasedby ¥1,102 million and non-controlling interests decreased by ¥863 million. And, in the fiscal year, net
sales decreased by ¥32,999 million and cost of sales decreased by ¥33,434 million, whereas
operating income, ordinary income and profit before income taxes increased by ¥435 million.
3. Revenue recognition
The main businesses of the company and its domestic subsidiaries are manufacture and sales of
products in the following business segments: Automotive, Infocommunications, Electronics,
Environment and energy and Industrial materials and others. Regarding the sales of these products,
revenue for domestic sales transactions is recognized mainly at the time of the acceptanceinspection by the customer or arrival at the customer, and revenue for export sales transactions is
recognized mainly at the time when risks are transferred to the customer on the basis of trade terms

such as incoterms. And in Environment and energy business segment, the company and its
consolidated subsidiaries operate the business of design and construction such as installation of
products besides the manufacture and sales of the products. With regard to these contract
constructions, for the performance obligation satisfied over time, revenue is recognized over time
based on the estimated progress towards the satisfaction of that performance obligation, and for the
performance obligation not satisfied over time, revenue is recognized mainly at the time ofcompletion of installation as the performance obligation satisfied at a point in time.
4. Changes in Presentation(Application of the “Accounting Standard for Disclosure of Accounting Estimates”)
The “Accounting Standard for Disclosure of Accounting Estimates” (ASBJ Statement No. 31, March
31, 2020) has been applied from the beginning of the current fiscal year ended March 31, 2021.
Regarding the amounts recorded on the consolidated financial statements of the current fiscal year
based on accounting estimates, the contents of accounting estimates for the items which may have asignificant effect on the consolidated financial statements of the next fiscal year ending March 31,
2022 are noted.
5. Accounting estimate(Impairment of fixed assets)(1)Amount recorded in the consolidated financial statements for the current fiscal year
The amount of assets in the Electronics segment is ¥231,709 million. Although there are indicationsof impairment in some asset groups, impairment loss was not recorded for the current fiscal year
as future cash flows exceeded the book value.
(2)Other information that contributes to the understanding of financial statements users regarding thecontent of accounting estimate.
The Company and its consolidated subsidiaries determine grouping of cash-generating units mainly
by business division, except that assets scheduled to be disposed of or idle assets are grouped as
individual asset groups. When any indication of impairment exists, the future cash flow of the asset
group is estimated. If the future cash flow is less than the book value, the book value of the asset is
reduced to its recoverable amount. If this recoverable amount decreases in the future, an impairment
loss may be incurred and may affect the business performance.
In the current consolidated fiscal year, the future cash flows of some asset groups in the Electronics
segment were estimated based on the medium-term business plan that consists of available market
information, customers’ forecasts and activities for development and sales expansion of new
products and cost reduction, etc. Consequently impairment loss was not recorded for the current
fiscal year. Considering the large volatility of market trends of final products and demands in thissegment, a decrease in future cash flows due to unpredictable changes in the business environment
in the future may have a significant impact on the determination of impairment of fixed assets.
(Large construction projects)(1)Amount recorded in the consolidated financial statements for the current fiscal year
The amount of sales in the Environment and energy segment is ¥634,191 million.
(2)Other information that contributes to the understanding of financial statements users regarding thecontent of accounting estimate
In Environment and energy business segment, the company and its consolidated subsidiaries
operate the business of design and construction such as electrical/power supply work,
engineering and installation of products besides the manufacture and sales of the products.
In the revenue recognition of contract constructions, for the performance obligation satisfied overtime, revenue is recognized over time based on the estimated progress towards the satisfaction ofthat performance obligation. If it is possible to measure the outcome of the performance obligation
reasonably, the method of estimating the progress towards the satisfaction of the performanceobligation is the input method based on the ratio of the actual costs to the total estimated costs. If it is
not possible to measure the outcome of performance obligation reasonably, revenue is recognized
only to the extent of actual costs incurred.
When estimating the total construction cost, the company and its consolidated subsidiaries calculate
the appropriate cost after specifying and covering the whole contents of work for executing thecontract constructions according to the specifications based on the customers’ instructions, andreview the estimate in a timely manner in response to the change of the situation after receiving
the order.
However, regarding long-term constructions such as large power cable projects, if additional costs
that exceed the estimate as of the end of the current consolidated fiscal year are incurred because of
unexpected circumstances such as extension of construction period or additional costs due toinfluence of weather or unforeseen change of the work contents, they may affect the profit and lossof the next consolidated fiscal year.
6. Notes to Consolidated Balance Sheet
6-1. Assets pledged as collateral and liabilities secured by collateral(1) Assets pledged as collateral
Property, plant and equipment(2) Liabilities secured by the above collateral
Short-term debt
Long-term debt
Total

¥2,014 million¥ 408 million¥ 271 million¥ 679 million

6-2. Accumulated depreciation of property, plant and equipment ¥1,871,376 million
6-3. Guarantees
Debt guarantees and similar agreements
Jiaxing SEI-Futong Optical Fiber Co., Ltd.
Daeheung SumiRiko Rubber Material (Yancheng) Co., Ltd.
Sumiden International Trading (Shanghai) Co.,Ltd.
Employees
OthersTotal
6-4. Notes receivable endorsed
6-5. Inventories
Merchandise and finished goods
Work in process
Raw materials and supplies¥1,771 million¥ 867 million¥ 247 million¥ 136 million¥ 222 million¥3,243 million¥480 million¥218,868 million¥176,707 million¥210,768 million

6-6. Other
The Company is in negotiations with some automakers for damages regarding violation ofcompetition law by it in the automotive segment.

7. Notes to Consolidated Statement of Income
Restructuring expenses in extraordinary losses are related to the reorganization and closing of thebusiness locations, etc., to strengthen profitability and to make efficient production structure ofanti-vibration rubbers business, optical devices business, wiring harness business, FPC business,
etc. The major details are loss related to transfer of shares of subsidiary of ¥2,698 million, extra
payment of retirement benefits of ¥2,402 million and impairment loss of ¥813 million.
8. Notes to Consolidated Statement of Changes in Net Assets
8-1. Type and number of shares issued and outstanding at the end of current fiscal year
Common stock
793,940,571 shares
8-2. Dividend Information(1) Dividends paid
Resolution

amount Dividends
Type of Total
of(Millionsof per share Record date Effective date Resources
sharesdividends
yen)
(Yen)

Shareholders’Commonmeeting on
stock
June 25, 2020
Board of Directors on Common
November 6, 2020
stock

March 31,2020

June 26,2020

12,481

16.00

12,481

December 1,
16.00 September
30, 2020
2020

Retainedearnings
Retainedearnings(2) Dividends of which record date was in the current fiscal year and effective date will be in thenext fiscal year
Resolution
Shareholders’meeting on
June 25, 2021

amount Dividends
Type of Total
of(Millionsof per share Record date Effective date Resources
sharesdividends
yen)
(Yen)
Commonstock

12,481

16.00

March 31,2021

June 28,2021

Retainedearnings

9. Financial Instruments
9-1. Qualitative Information on Financial Instruments
The Company and its consolidated subsidiaries finance investment in equipment and operating
capital for business, mainly using borrowings from banks and the issuance of bonds andcommercial papers in accordance with their cash flow planning.
Trade notes and accounts receivable are exposed to the credit risks of customers. The
Company and its consolidated subsidiaries try to reduce and manage the risk according to theirrules for credit control.
Operating receivables denominated in foreign currency are exposed to foreign exchange risks.
The Company and its consolidated subsidiaries hedge the risks using forward exchange
contracts, etc., for the net position of foreign currency operating receivables and payables.
Securities and investment securities are mainly held to build and strengthen long-term andstable customer relationships and to facilitate business and technical customer partnerships andare exposed to market value fluctuation risks.
The main purpose of holding debt and issuing bonds and commercial papers is to secure
financing for capital expenditure and working capital.

9-2. Fair Value of Financial Instruments
The carrying amounts and fair values of the financial instruments on the consolidated balance
sheet as of March 31, 2021 are set forth in the table below.
(Millions of yen)**
Difference
Carrying amount
Fair value(1) Cash and time deposits
253,668
253,668－(2) Trade notes and accounts receivable
755,258
755,258－(3) Securities
727
727
－
(4) Investment securities
303,378
482,220
178,842(5) Trade notes and accounts payable(397,439)(397,439)－(6) Short-term debt
(310,695)(310,695)－(7) Commercial papers(14,000)(14,000)－(8) Bonds(104,873)(104,996)
123(9) Long-term debt
(205,113)(207,318)
2,205*Any item accounted for as a liability on the consolidated balance sheet is indicated in parentheses.

(Note) 1. Valuation approach for the fair value of financial instruments and matters related to securities
and investment securities(1) Cash and time deposits and (2) Trade notes and accounts receivable
The carrying amount approximates the fair value because of the short maturity.
(3) Securities
The carrying amount is nearly equal to the fair value because of the short maturity.
(4) Investment securities
Investment securities which have a quoted market value are stated at the fair market value.
The fair value of those which do not have a quoted market value is estimated based on thepresent value of future cash flows using appropriate current discount rates.
(5) Trade notes and accounts payable
The carrying amount approximates the fair value because of the short maturity.
(6) Short-term debt
The carrying amount approximates the fair value because of the short maturity of one year or
less.
(7) Commercial papers
The carrying amount approximates the fair value because of the short maturity.
(8) Bonds
The fair value of bonds is stated at the fair market value.
(9) Long-term debt
The fair value of long-term debt is estimated based on the present value of future cash flows
using appropriate current discount rates.
2. Unlisted Securities (the carrying amount on the consolidated balance sheet is ¥104,028
million) are not included in “(4) Investment securities,” because they do not have quoted
market values and their future cash flows cannot be estimated, therefore, their fair value ishard to determine.
10. Per Share Information
Net assets per share
Earnings per share¥2,088.51¥ 72.25

11. Additional Information
Due to the impact of COVID-19, there was a noticeable drop in demand for products mainly in thefirst quarter of the fiscal year ended March 31, 2021, but it has turned into recovery trend in generalfrom the second quarter. Based on external information available as of the end of the fiscal year
ended March 31, 2021, such as customers' forecasts, the Company and its consolidated
subsidiaries have made accounting estimates for impairment of fixed assets under the assumptionthat COVID-19 will not make a significant impact on the business from the next fiscal year ending
March 31, 2022. However, the impact of COVID-19 on the future economy and business activities is
unclear, so if the above assumptions change, there is a possibility that it will affect the businessresults for the next consolidated fiscal year.