Basic Policy on the Internal Control System, ver. 20
All activities of Olympus are based on our Corporate Philosophy, “Making people’s lives healthier,safer and more fulfilling.”
Olympus, based on this basic concept, shall prepare and operate a framework which ensures theeffectiveness and efficiency of operations and appropriateness and reliability of financial
reporting of Olympus and its subsidiaries (hereinafter, “the Olympus Group”), and makecontinuous improvements.
I

Framework to ensure the appropriateness of business operations in the Olympus Group

1.

Framework to ensure that the execution of duties by Olympus’s executive officers and employees
and by the directors and employees of subsidiaries complies with applicable laws andregulations and the Articles of Incorporation(1)
Olympus shall establish “Management Basic Policy,” basic policy the Board of Directors
relies on when the Board of Directors monitors the execution of duties of Directors andExecutive Officers. Furthermore, it shall establish the Olympus Global Code of Conduct andinternal corporate regulations for quality, product safety, and export control, etc., basedon the Corporate Philosophy, and shall instill the policies and facilitate initiatives to raiseawareness of compliance in the Olympus Group through continuing education and othermeasures.
(2)
Olympus shall also establish a compliance promotion system by appointing an officer incharge of compliance and establishing a function in charge of group-wide compliance. The
function in charge of group-wide compliance shall be responsible for activities toward theimprovement of the group compliance system based on the Global Compliance Management
System. In addition, whole Olympus Group shall continuously conduct education ofemployees and measures relating to assessment. Furthermore, within the Olympus Group,
if there is or may be a violation of laws and regulations, etc., a global contact desk which
can be available 24 hours a day in multiple languages, and a local hotline contact desk ineach region will receive the report of them.
(3)
Olympus shall set up an internal audit function reporting directly to the Chief ExecutiveOfficer. The internal audit function shall conduct audits to verify the effectiveness of thevarious processes for risk management, control and governance within the Olympus Groupin accordance with the internal audit regulations. The internal audit function shall report
the results of internal audits to the Chief Executive Officer and the Audit Committee.
(4)
In order to ensure the appropriateness and reliability of financial reporting of the Olympus
Group, the internal audit function shall continue to conduct improvement activities byregularly evaluating its efforts and operations to ensure that control activities relating tofinancial reporting function effectively under the internal control system.
(5)
Olympus shall be responsible for working with lawyers, the police and other parties tosystematically stand firm against anti-social forces and organizations which threatensocietal order and safety. The Olympus Group continuously shall conduct measures for
excluding anti-social forces and prepare relevant rules and regulations in order to maintainits social responsibility to exclude anti-social forces.

2.

Framework regarding the maintenance of records and management of information in relation
to performance of duties by Executive Officers of Olympus(1)
Pursuant to laws and regulations and the internal rules on document management in eachregion, Olympus shall maintain and manage documents or electronic data.
(2)
Directors may access important documents such as the minutes of a meeting of the Boardof Directors and documentary approvals when necessary based on the internal rules on
document management.
13.

Regulations and other framework relating to managing risks of loss of the Olympus Group(1)
Olympus shall manage its business risks of the Olympus Group based on due deliberations
held at meetings of the Board of Directors and the Group Executive Committee, among
other meetings, and appropriate operation of the internal approval procedure.
The Board of Directors shall determine basic management policy, matters related to theinternal control system, other important matters and important matters related to businessexecution, as well as deciding matters to delegate to Executive Officers. Also, for importantmatters not decided by the Board of Directors, Executive Officers shall make a decision, andmake a report to the Board of Directors.
(2)
Olympus shall manage risks such as those relating to quality, product safety, export control,
information security, health and safety, the environment and disasters by designating
functions in charge, establishing internal corporate regulations, working for preventive risk
management as the Olympus Group, and implementing education and training.
(3)
Based on the Internal Control Rules and other related rules, Olympus shall prevent theemergence of serious risks resulting from the business activities of the Olympus Group, andshall create, operate appropriately, and manage a risk management system to minimize
damage in the event of such risks emerging.
Moreover, pursuant to the Risk Management Operation Rules, each function in charge inthe Olympus Group shall be aware of risks and take preventative measures, and Olympus
has a framework which enables prompt actions in the event of an emergency. In the eventof a violation of corporate ethics, or an earthquake, fire or accident, the function in charge
shall make immediate reports to the Executive Officers and relevant people. The final
determination in such circumstance shall be made by the Chief Executive Officer.

4.

Framework to ensure the effective performance of duties by Executive Officers of Olympus andDirectors of its subsidiaries(1)
The Board of Directors shall approve medium- and long-term Corporate Strategy in which
the business objectives of the Olympus Group are set forth, and action plans for these, whichare called business plans and other important matters. In addition, the Board of Directors
shall delegate except matters that should be resolved by the Board of Directors to Executive
Officers in order to enhance efficient and agile decision-making on the execution of business.
In addition, the Board of Directors shall receive reports, once a quarter, on businessperformance in order to evaluate the status of our business plan, and monitor Executive
Officers’ performance of duties.
(2)
The Board of Directors shall determine the assignment of duties among the Executive
Officers. In addition, the Board of Directors shall receive, at least once every three months,
reports on their duties as performed.
(3)
Based on the Job Authority Rules, Organization Rules, and other related rules, Olympus
shall define the responsibilities and authorities of major job ranks and the Board of
Directors receives reports from major management organizations on their duties asperformed.
(4)With the establishment of Treasury Control Framework, which regulate financial policies
as a base for financial operations of the Olympus Group, Olympus strengthens thegovernance of the Olympus Group from a financial aspect, and oversees and manages
funding, foreign exchange, and transactions with financial institutions for the Olympus
Group including the subsidiaries.

25.

Framework for reporting to Olympus on matters concerning execution of duties by the Directors
and employees of the subsidiaries(1)
After Olympus has clarified the management criteria of subsidiaries by means of theAffiliated Company Management Rules and other related rules, the officers responsible forthe regional headquarters shall conduct reviews of the situation faced by subsidiaries’
management, and periodically report the results of the reviews to the CEO of Olympus.
(2)
Olympus shall ensure receiving reports as appropriate and in a timely manner from thesubsidiaries in accordance with the Global Consolidated Accounting Control Framework toensure that we will remain accurately informed of financial position and results of operationof the Olympus Group, and appropriately maintain and manage the consolidated accounting
policies.

6． Other framework to ensure the appropriateness of business operations in the Olympus Group(1)
Olympus shall dispatch its executive officers, corporate officers, or employees to major
subsidiaries as directors, auditors, or other equivalent positions, and the head of eachfunction manages such whole function within the Olympus Group. Furthermore, In orderto ensure the fairness of operations of subsidiaries, Olympus request them to obtain ourapproval for significant matters of subsidiaries based on the Job Authority Rules and anyother related rules.
(2)
Olympus has appointed an officer in charge of ESG and set goals related to ESG in theOlympus Group and shall continue to work on them. Moreover, Olympus has set ESGrelated indicators as part of the performance-linked compensation for executives and isstrengthening its efforts as a management strategy.
IIMatters necessary for the execution of duties of the Audit Committee

1. Framework for matters related to employees whose assignment is to assist in the duties ofOlympus’ Audit Committee, and matters related to the independence of those employees from theExecutive Officers of Olympus, and matters related to ensuring the effectiveness of instructions
from the Audit Committee of Olympus to those employees
Olympus shall allocate a dedicated employee who will assist with the Audit Committee’s duties.
Moreover, Olympus may have a concurrent employee as needed. In addition, we shall set forthinternal corporate regulations to ensure independence from execution as stated below, andensure effectiveness of directions from the Audit Committee to such employees.
① While employees who have been assigned to assist in the duties of the Audit Committee
assist in those duties, Directors (excluding Audit Committee members), Executive Officers
and employees, etc. shall not give them commands or instructions.
② The appointment, dismissal, transfer, wage or personnel evaluation of employees who areassisting the Audit Committee with their duties shall be decided only after obtaining theapproval of the Audit Committee.
2.

Framework regarding reports by Directors (except those who are members of the Audit
Committee), Executive Officers and employees of Olympus to the Audit Committee, and reports
by Directors and employees of the subsidiaries of Olympus or personnel who have received
reports from them to the Audit Committee Olympus(1) When Directors (except those who are members of the Audit Committee), Executive officers,or employees of Olympus, as well as any Directors, Audit and Supervisory Board members,
or employees of a subsidiary discover any material fact in violation of laws, regulations, orthe Articles of Incorporation, any fact that may cause significant damage to the Olympus
Group, or any fact that is significantly inappropriate for the corporate affairs of the3

(2)

(3)

Olympus Group, they shall immediately report such fact to the Audit Committee, either
directly or through the responsible function. In other cases where the Audit Committee
requests a report from a Director, Executive officer, or employee, etc. of the Olympus Group,in accordance with laws and regulations or Audit Committee Rules etc., the Director,Executive Officer, or employee in question shall promptly report to the Audit Committee.
Chief Compliance Officer shall regularly make reports to the Audit Committee on the statusof compliance within the Olympus Group. In addition, Chief Compliance Officer shallregularly make reports on details of issues reported and results of investigations inaccordance with the Internal Reporting System.
The internal audit function of Olympus shall regularly report the status of internal audit
in the Olympus Group to the Audit Committee of Olympus.

3.

Framework to ensure that any personnel who have made a report to the Audit Committee ofOlympus will not be subjected to any unfair treatment due to the report madeOlympus shall set forth internal corporate regulations and shall not impose any unfair
treatment (including de-facto measures such as restricting the personnel to engage in duties, orassigning the personnel solely to work on chores, in addition to measures of personnel affairs
such as dismissal, demotion, pay cut and other disciplinary actions and disadvantageoustransfer) to any personnel who have made a report on the grounds of having made a report tothe Audit Committee.

4.

Matters regarding procedures for advance payment of expenses incurred in connection withexecution of duties by the Audit Committee members of Olympus and their reimbursement, andtreatment of other expenses or liabilities incurred in connection with execution of the duties
When an advance payment or reimbursement of expenses is requested for execution of duties ofAudit Committee members, Olympus shall promptly, in accordance with Olympus’s rules andregulations, process disbursement except for such case that the expense is obviously deemed
unnecessary for execution of duties by Audit Committee members.

5.

Other systems to ensure the effectiveness of audit by the Audit Committee of Olympus(1)
Directors, Executive Officers and employees of Olympus and Directors and employees of thesubsidiaries shall ensure effectiveness of the audit by cooperating with the Audit Committee
for investigations by interviews and on-site inspections.
(2)Olympus shall ensure that it provides the Audit Committee with opportunities tosufficiently exchange opinions with Directors, Executive Officers, Accounting Auditors andany other personnel necessary.
(3)
Olympus shall ensure that Audit Committee members have opportunities to attend
important meetings.
(4)
The Audit Committee shall work closely with the internal audit function to receive reports
on audit results, etc. from the internal audit function, and the Audit Committee may
exercise its authority to give instructions and make commands to the internal audit function
as necessary.
(5)
Olympus shall ensure that it provides the Audit Committee with, upon their request,
opportunities of collaboration between the Audit Committee and Audit Committee of thesubsidiaries and collecting information from employees of the subsidiaries.

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