30％ Club Japan
Investor Group
Progress Report
vol.1
December 2022

Contents
1.

Activity report 2022

2.

Best practices of engagements on gender diversity

3.

Overseas activity

Disclaimer: The English version is a translation of the original in Japanese and is for
information purposes only. In case of a discrepancy, the Japanese original will prevail.

Activity report, February-October 2022
Feb 2022

Hosted a panel discussion pm the theme of SOURCINGAND HARNESSING THE POWER OF A DIVERSE BOARD

Mar 2022

English version of annual report 2020/2021 was publishedApr 2022

Hosted the fourth gathering with female directors andstatutory auditors of the JICPA

Oct 2022

Hosted the fifth gathering with female directors andstatutory auditors of the JICPA

The interview with Ms. Keiko Tashiro, Director (Member ofthe Board), Deputy President, Daiwa Securities Group Inc.
was released(QR code link to Japanese)

Best practices of engagements
on gender diversity
Electronics Industry - Company A
Issues identified•Company A is a leading consumer electronics company that is included inTOPIXMid400. Company A has an audit committee, and one female external
director has already been appointed out of nine directors. In April 2021, a new
CHRO (Chief Human Resources Officer) was appointed to promote a series ofbusiness restructuring through the working style reform. At the same time, thecompany recognizes that its human capital strategy needs to be challenged.
Company A is now focusing on the development of global-oriented businessstrategy, which requires global talent development as well. However, KPIs anddisclosure on diversity are extremely limited; for example, only corporate’swelfare related KPIs are available, such as the rate of parental leave taken, theratio of female employees, etc. Our engagement has been focusing thatCompany A needs to show the linkage between the business strategy andhuman capital strategy from the viewpoint of corporate value enhancement.
Also, the establishment and disclosure of diversity related KPIs, which are in linewith that human capital strategy, has been encouraged for Company A.

Best practices of engagements
on gender diversity
Electronics Industry - Company A
Engagement details and comments from company•As a consumer electronics company that needs to attract a diverse customer baseglobally, we informed them that the promotion of diversity should be one of thekey issues in its management strategy. An engagement was held with both theexecutive officer in charge of IR and the head of the Sustainability Promotion
Office. In order to clarify the key issues, the engagement toolkit by the 30% ClubJapan Investor Group, the METI’s diversity action guidelines and good practice
examples of disclosure were used to explain those issues. Through theengagement process, the necessity to develop and disclose diversity strategies,
including a development of global human capital management, a structural systemfor promoting diversity, an awareness and behavioral reform, and anestablishment of appropriate KPIs and milestones, was highlighted.

•The company recognizes the urgency to develop a diversified human capital inorder to produce the results from the structural reforms of the medium-termmanagement plan. The CHRO was appointed in April 2021 and in charge of all thehuman capital strategy. The CHRO responded that he would like to actively workon the diversity promotion policy and the realignment of KPIs and information
disclosure. Company A commented that the engagement had highlighted variousissues across the company and would like to continue the engagement process
together with CHRO.

Best practices of engagements
on gender diversity
Electronics Industry - Company A

Engagement results and future prospects•Through the engagement process, we confirmed that Company A has recognized theurgency to change the current situation. It is noted that we have achieved common
understanding to promote the diversity issue. Also, we found that the diversity
related information disclosure in the 2022 Integrated Report has been improved.
However, we need more time to see the actual results from the diversity promotion.
We would like to encourage their efforts, while checking the ongoing their diversity
related various activities through continuous engagements.

Best practices of engagements
on gender diversity
Infrastructure Industry - Company B
Issues identified•Company B, included in TOPIX100, runs infrastructure businesses. The company
had not appointed a female board member prior to the annual general meeting ofshareholders in 2022. As often observed in this industry, the percentage of female
employees joining as new graduates has been low for many years. This has caused
the company-wide female participation rate to remain at a low level, and has
prevented the development of female employees in middle management positions.
Considering the public nature of the infrastructure industry and that Company B had
identified the development of a better working environment as a priority issue, it
was considered beneficial for the company to have diverse perspectives, including
gender, on the board of directors. For this reason, we asked the company about thestatus of its strategy to improve the gender diversity of the board, including asearch for director candidates from external talent pool. We also discussed theirefforts to improve the gender diversity of its employees.

Best practices of engagements
on gender diversity
Infrastructure Industry - Company B

Engagement details and comments from company•

The engagement was held with the top management of Company B to confirm themanagement’s recognition of the diversity issues and the status of its efforts. Until
1999, the Labor Standards Act prohibited female employees from working latenight (with exceptions to some industries). As the infrastructure industry often
involved late-night labor, Company B had hired very few female employees.
However, since the amendment of the Act, female employment has gradually
increased, and the company recently appointed its first female executive officer.
The top management explained that the gender diversity issue should be one of
the top priorities and they had been taking steps to further promote female
empowerment. In addition, they commented that the board composition would
need to be reviewed both in terms of the independence ratio and gender diversity,and that they are considering appointing a female independent director to improve
the situation.

Best practices of engagements
on gender diversity
Infrastructure Industry - Company B
Engagement details and comments from company (continued)• Based on the engagement with the management, we held a follow-up engagementwith the IR and SR team to discuss more about Company B's efforts to improve thegender diversity of employees. Company B established a project to promote female
empowerment several years ago, led by their Human Resources division. They set
several KPIs including the ratio of female employee recruitment and the number ofwomen in middle management positions. Company B added that they ran theproject in consideration of each employee’s preference and career plans. For
example, the company increased flexibility in the field experience that the company
believed was important for employees’ career progression; the employees are now
able to share their preferred period to participate in the field experience. Thecompany also arranges networking events for female employees and training forsupervisors of female employees. They have found that the networking
opportunities are particularly effective in changing the mindset of female employees
towards promotion to middle management positions.

Best practices of engagements
on gender diversity
Infrastructure Industry - Company B
Engagement results and future prospects•

One female independent director with expertise in the fields of public policy andcorporate governance was appointed at the annual general meeting in June 2022.
We appreciated that Company B appointed a female director with an appropriate
skill-set for Company B's business strategies. We expect to see Company B’s effort
to further improve diversity and effectiveness of the board. We will also continue tomonitor the status of human capital development, including the appointment offemale middle-managers and executive officers, through future engagements.

Best practices of engagements
on gender diversity
Railway Industry - Company CIssues identified• An incident which was regarded as 'sexual harassment' occurred at Company C and
the incident was reported in the media. This incident triggered the engagement on
the diversity issues at Company C. In particular, we pointed out and discussed thedelays in diversity initiatives in the headquarters and railway division, which havebeen the central function of Company C.

Engagement results and future prospects• Company C disclosed its targets and strategies to promote the empowerment of
women in each of its major business units. Regardless of industry characteristics
and historical background the diversity is an important management issue, which is
directly related to corporate value. Through such diversity related initiatives,
Company C is expected to contribute to the regional society, where they areoperating their railway and various related business. We would like to continue theengagement with Company C and check their progress in the future.

Best practices of engagements
on gender diversity
Wholesale Industry - Company D
Issues identified• Company D needs to expand its new non-resource business. To achieve this target,
the diversity of human capital, which is the core of its competitiveness, is critical.
Two female independent directors were nominated out of eight in total board
members after AGM of 2021. Board diversity has been improved; however, there is
only one female executive officer who is closer to the business. We recognize that
Company D needs to further promote gender diversity at employee level and show
their role models of female executive.
Engagement results and future prospects• Company D agreed those issues and explained us about their strategies to promote
diversity for sustainable growth in the medium to long term. In December 2021,
following the engagement, Company D’s second female executive officer with thehigh skill set was appointed. Her expertise is important for Company D’s businessstrategy. It is noted that the diversity efforts has been penetrated across Company
D and steadily progressing toward the sustainable growth in the future.

Overseas activitiesFrance - Continuing the engagement campaign• The France Investor Group expects executive management teams of SBF120
companies to appoint women to at least 30% of seats by 2025.
• After one year of campaign, the 30% Club France IG reported on its 2021
engagement activities. We observed that:− The percentage of women in executive management roles has improved
from 20% to 23%− The number of companies with at least 30% women on the ExCom
increased from 25 to 39.
− But we also believe that progress is too slow: 14 more companies with adecent female representation at executive management level is positive, butat this rate it would take another six years to achieve at least 30% across theSBF 120 while the 30% Club France IG has set itself 2025 as a deadline for atleast 30% at the ExCo levels.

Overseas activities
France - Continuing the engagement campaign• As such, in 2022, the 30% Club FR IG continued their efforts with this objective asa first milestone (ultimate goal is parity) as they want to go beyond and drive
genuine and sustainable change by looking not only at the Exco level but also howcompanies build a gender diverse talent pipeline.
− 5 corporate engagement meetings were done but more is to come in2022 H2 now that the proxy voting season is over.
− Meeting with experts in order to create an ecosystem of thoughts, aplatform of exchanges and to frame upon recommendations:✓ Marie-Pierre Rixain, Member of the French Parliament who defended thelaw on economic and professional equity for women (September)✓ Mercer on gender pay equity (March)✓ Deloitte on how to break the glass ceiling in Finance (April)✓ Amanda Pullinger as CEO of 100 Women in Finance (end of October)Overseas activities
UKTargets• Since we have started in 2010, female representation has increased from 12% in
FTSE 100 to 40% in 2022. Our current targets are as follows:• Beyond 30% representation of women on all FTSE 350 boards, to include one
person of colour by 2023
• We support the Parker Review goals for at least one person of colour on every FTSE
350 board – in addition, we advocate for gender balance with half these seats
going to women, creating 175 board seats for women of colour.
• Beyond 30% representation of women on all FTSE 350 Executive Committees, toinclude one person of colour by 2023
• We advocate for gender balance with half these seats going to women, creating
175 executive committee roles for women of colour.
• Beyond 30% of all new FTSE 350 Chair appointments to go to women between July
2020 and 2023
• Beyond 30% representation of women at senior management level of FTSE 100companies (ExCo + direct report levels).

Overseas activities
UK
Current Focus & Progress• We have made great progress in FTSE 100 companies; therefore, we now have arenewed focus on FTSE 250 companies as well, particularly on race and ethnic
diversity.
•Race Equity Statement: In March 2022, wepublished a statement to address racialinequality in companies, where most of ourmembers committed to support the delivery of
the UK 30% Club 2023 targets around race andethnicity•

Race Equity Engagement: We have targeted
13 FTSE 250 companies that do not meet theParker Review recommendation of having atleast one person of colour on the board.
Engagement letters are being sent tocompanies allowing them the opportunity torespond on how their company will progress inmeeting this target.

•Global Engagement: The Investor Group has
also gone beyond the UK to work with theCanadian Chapter to engage in North Americancompanies that are considered laggards inboard diversity. To date we have sent
engagement letters to four companies thathave less than 20% female representation on
their boards. We are now researching further
laggards to identify which other companies inNorth America we should engage with.

•Reporting: We also recently published a bestpractice guide for UK companies to help with
their diversity and inclusion reporting bysetting out clear investor expectations andexamples of best practice•Research: We worked with Diversio to analyse
FTSE 100 companies on three Diversity andInclusion-related metrics: Board and Executive
diversity, DEI programs and policies, and theprevalence of 27 “inclusion barriers” –measured by applying artificial intelligence toemployee reviews. Our goal was to identify top(and bottom) performers, uncover key driversof bias and exclusion, and enrich theconversation about DEI.

Overseas activities
Australia• In the ASX200, more than 35% of Directors are now women, as at September
2022, although there remain two companies with no women on their Boards. We
would also note that of non-executive directors in the ASX200, more than 40% are
now women.
• We completed a study recently looking at IPOs and the situation is far lessencouraging. Out of the 401 newly listed companies between 2019 and 2022, only
12.2 per cent of IPO directors were women.
• Focus continues on the representation of women in executive roles, withorganizations such as Chief Executive Women and the 40:40 Vision working withinvestors to get increased representation of women in senior executive roles oflisted companies.