This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between thistranslated document and the Japanese original, the original shall prevail.

Corporate Governance Report
CORPORATE GOVERNANCE

RIKEN TECHNOS Co, Ltd.

Last Update:June, 24, 2024

RIKEN TECHNOS CORPORATION
Kazuaki Tokiwa, Representative Director, President & CEO
Contact: +81-3-5297-1632
Securities code: 4220
https://www.rikentechnos.co.jp/e/
The corporate governance of RIKEN TECHNOS CORPORATION (the “Company”) is described below.

I. Basic Views on Corporate Governance, Capital Structure, Corporate Profile and Other
Basic Information
1. Basic Views
The Group shall establish a management organization system and structure, and implement necessary measures in order toachieve sustainable growth and improve corporate value over the medium to long term through the implementation of the“RIKEN TECHNOS WAY,” its corporate philosophy. By positioning the strengthening of corporate governance as one of themost important management issues, the Group shall strive to strengthen the Group's competitiveness and ensure managementtransparency and fairness by establishing an effective governance system for the entire Group.

Reasons for Non-compliance with the Principles of the Corporate Governance Code
The Company complies with all principles in Japan’s Corporate Governance Code.

Disclosure Based on the Principles of the Corporate Governance CodeUpdated[Principle 1-4 Strategic-Holding Shares]< Policy on Reduction of Strategic-Holding Shares >With regard to strategic-holding shares, the Company shall ensure that the Board of Directors annually review specifically therationality of holding each company’s stocks including the cost of equity and the benefits of holding, and immediately reduce theratio of strategic-holding shares to reach less than 10% of consolidated net assets. The cash generated by the reduction will be
used primarily for growth investment and also for shareholder returns, and in this way we will accelerate medium to long term
growth in the future.
In fiscal 2023, in addition to examining the appropriateness of holding individual stocks, including those held by consolidated
subsidiaries, we conducted comprehensive examinations, including capital policies, and sold all or some of 24 of the 34 issues(stocks) held by the Company. All proceeds from the sale were used to fund the acquisition of treasury stock so as to enhanceshareholder returns.
< Standards for the Exercise of Voting Rights Related to Strategic-Holding Shares >With regard to the exercise of voting rights for strategic-holding shares, the Company shall exercise voting rights by respecting
the management policies and business strategies of the issuing company, and comprehensively taking into consideration whether
or not there are any management concerns or the contents of the proposals contribute to the development of the issuing company's
appropriate corporate governance system, whether or not such exercise contributes to the improvement of the medium- to longterm corporate value and the sustainable growth of the Company and the issuing company, etc. In exercising voting rights, theCompany shall also refer to the standards for exercising voting rights of the proxy-advisory firm.
[Principle 1-7 Transactions Between Related Parties]
In the event of transactions between the Company and the related parties, the Company implements appropriate procedures
according to the contents and nature of such transactions, such as approval by the Board of Directors in accordance with theCompanies Act and the Regulations on the Board of Directors. In addition, the Company discloses the results thereof in the
Annual Securities Report, etc. in a timely manner in accordance with relevant laws and regulations.
Furthermore, the Company implements annual surveys on related-party transactions and monitors and supervises the Directors,
etc. of the Company and companies of the Group.
[Principle 2-4 Ensuring Diversity Within the Company, Including Promoting the Activities of Women][Supplementary Principle 2-4-1]< Views on Ensuring Diversity >The Company recruits and promotes a diverse range of human resources, regardless of gender, nationality, or whether they are
new graduates or mid-career hires. In order to accelerate the global development of our businesses and respond quickly to therapidly changing market environment in the future, we will actively recruit and promote human resources with differingexperience, skills, and careers, establish a system for developing human resources that will enable these human resources to play
an active role, and promote the development of a suitable environment. In particular, taking employees in managerial positions as
our core human resources, the Company will work to spread a broad awareness of ensuring diversity, and set targets for the ratiosof employees in managerial positions who are women, foreign nationals, and mid-career hires.
(i) Promotion of women to managerial positions
The Company will strengthen mid-career recruitment in departments where women are particularly expected to play anactive role (such as administrative and sales departments) and promote these employees to managerial positions. In
addition, in departments where a high level of expertise is required (such as technical departments), the Company utilizes a
specialist system (professional system) for managerial positions.
(ii) Promotion of foreign nationals to managerial positions
Focusing on the ASEAN region (priority region), where the Company is expanding global operations, we will strengthen
the recruitment of students studying overseas and local hires, and will develop them as candidates for managerial posts. We
will also strengthen the mid-career recruitment of managers able to play an active role globally. In the future, the Company
will promote these employees to senior managerial positions, such as the heads of sites of consolidated subsidiaries
overseas.
(iii) Promotion of mid-career hires to managerial positions
In order to respond to the increasingly diverse social environment and revitalize our organization in the future, we will
strengthen mid-career recruitment beyond existing levels and thus take in new ideas and technical expertise from outside theCompany.
< Voluntary and Measurable Goals Related to Ensuring Diversity and the Status Thereof >When goals were set
Current status
Goal(March 31, 2021)(March 31, 2024)(i) Promotion of women to
1.8%
2.1%
7.0%
managerial positions(ii) Promotion of foreign
0.6%
0.7%
3.0%
nationals to managerial
positions(iii) Promotion of mid-career
30.3%
29.8%
40.0%
hires to managerial
positionsTime of achievement
March 31, 2025
March 31, 2025
March 31, 2025

< Human Resource Development Policy and Internal Environment Development Policy to Ensure Diversity and the Status
Thereof >(i) Human Resource Development Policy
Based on the idea that employees and the Company have a relationship of mutual growth, and “the employees' growthmeans the company's growth,” our policy for human resource development aims for a state in which 1) each employee
implements the “RIKEN TECHNOS WAY” and grows into human resources that the Company expects them to be; and 2)
the Company achieves growth simultaneously by uniting the abilities possessed by each individual and exerting it as anorganizational capability. We will support further development of the Company by providing places for optimal work andenvironments where each and every employee can demonstrate the abilities required by the Company. We will actively
develop human resources who can win amid global competition, support the growth and success of employees, bring
together enhanced individual abilities through dialogue, and demonstrate collective strengths of the team.
Based on these policies and ideas, we will respect the diversity of each and every employee and work to develop corehuman resources by giving them the opportunity to experience a career path in which they can fully leverage their abilities.
Furthermore, in addition to education based on on-the-job training that also enhances basic skills in a manner suited to theunique characteristics of each position, the Company will also create opportunities for growth by enhancing careerdevelopment training and other human resource development training.
(Specific measures)• Support for career development in which supervisors provide guidance to subordinates concerning growth and a diverse
range of career paths• Enhancement of onboarding training (language, manners, career, etc.) to ensure the active role of foreign nationals• Implementation of Diversity and Inclusion Promotion Project(ii) Internal Environment Development Policy
To become a globally competitive company, the policy for internal environment development of the Company is to establish
systems and foster a culture so that employees with diverse individualities can play active roles at work. The Group willrealize a diverse way of working and create schemes and environment where diverse human resources feel comfortable inexerting their individualities and work to their fullest potential freely and energetically.
(Specific measures)• Utilization of a specialist system (professional system) for employees in positions that require a high level of expertise• Implementation of Diversity and Inclusion Promotion Project• Education to change mindsets aimed at recognizing each other’s diversity (e.g., being permissive of subordinates’
workstyles)• Strengthening of systems and initiatives that emphasize work-life balance (strengthening of initiatives such as theworking-hour interval system and no-overtime days, etc.)

[Principle 2-6 Fulfilling the Role as Asset Owner of Corporate Pension]
In order to enable the corporate pension fund to fulfill its function as asset owner, the Company appoints and allocatesappropriately qualified personnel, such as those with experience in accounting and finance divisions, etc. The corporate pension
fund has established the asset management committee, which consults on important matters relating to the investment of pension
assets, such as the formulation and revision of the basic policy and the basic portfolio, and periodically monitors the investment
status, etc., and reports the results to the Management Committee.
Comprehensive evaluations are also implemented for the investment trustee by adding qualitative assessment to quantitative
assessment.
[Principle 3-1 Enhancement of Information Disclosure](i) Company objectives (management philosophy, etc.), management strategies, and business plans
The Company has established the “RIKEN TECHNOS WAY” as its management philosophy and an overview is publishedon the Company’s website.
https://www.rikentechnos.co.jp/e/company/philosophy/
In addition, as part of the management strategy and business plan, the Company has formulated a three-year Medium-term
Business Plan (April 2022 to March 2025), which is published on the Company’s website.
https://www.rikentechnos.co.jp/e/company/management_policy/(ii)

Basic views and policies on corporate governanceThis information is as stated in “I. 1. Basic Views” of this report.

(iii) Policies and procedures for determining compensation for Directors and Executive Officers
Compensation for Directors (excluding Directors who are Audit & Supervisory Committee Members) is set at an
appropriate level of compensation in accordance with the positions and responsibilities of Directors, based on acompensation plan that motivates Directors to improve business performance in each fiscal year and improve corporate
value over the medium- to long- term, while also enabling them to share value with shareholders.
Compensation for Directors (excluding Directors who are Audit & Supervisory Committee Members) consists of executive
compensation and supervisory compensation. Executive compensation consists of a fixed amount of basic compensation(cash) and bonuses as performance-linked compensation (cash and stock benefits). Supervisory compensation consists of a
fixed amount of basic compensation (cash) and a fixed amount of stock benefits.
Compensation for Executive Officers consists of executive compensation, which consists of a fixed amount of basic
compensation (cash) and bonuses as performance-linked compensation (cash and stock benefits).
Compensation for Directors who are Audit & Supervisory Committee Members consists of supervisory compensation,
which consists of a fixed amount of basic compensation (cash) that is not linked to performance and a fixed amount of stock
benefits.
When determining the compensation of Directors (excluding Directors who are Audit & Supervisory Committee Members)
and Executive Officers, the Board of Directors consults in advance with the Compensation Committee, a majority of whichis composed of Independent Outside Directors, and makes decisions with respect for the results of such reports. In addition,
the compensation for Directors who are Audit & Supervisory Committee Members is determined by deliberation among
Directors who are Audit & Supervisory Committee Members within the limit amount determined by resolution of theGeneral Meeting of Shareholders.
Furthermore, policies for determining the content of compensation, etc., for individual Directors are described in “II. 1.
Organizational Composition and Operation [Director Remuneration] Disclosure of Policy on Determining Remuneration
Amounts and the Calculation Methods Thereof” of this report.
(iv) Policies and procedures for the nomination of candidates for Directors and selection and dismissal of Executive Officers
When nominating candidates for Directors and selecting Executive Officers, the Company takes into consideration theknowledge, experience, and abilities of each individual, and takes care to ensure it maintains a well-balanced and diversemix of human resources as a whole.
Specifically, regardless of gender, age, or nationality, on the assumption that the candidate is outstanding in character andhas a high sense of ethics and legal compliance, the Company comprehensively reviews and makes a decision concerningwhether the candidate is well versed in various management issues with superior management senses, whether inside oroutside the Company, and is excellent in terms of initiative, leadership, activity, and planning, and other factors.
In addition, when nominating a candidate for Director for reelection or reselecting Executive Officers, the Company
comprehensively reviews and makes a decision concerning matters such as the possibility of the candidate contributing tofrank, active, and constructive discussions even after reappointment, taking into consideration continuously meeting theabove appointment standards as well as the statements made at the meetings of the Board of Directors and the Management
Committee during the term of office and the status of attendance at such meetings, and other factors.
In addition to the above standards, when nominating candidates for Directors who are Audit & Supervisory Committee
Members, the Company makes decisions such that one (1) or more persons with considerable knowledge of finance andaccounting are elected.
When nominating candidates for Directors and selecting Executive Officers, the Board of Directors consults in advancewith the Nomination Committee, a majority of which is composed of Independent Outside Directors, and makes decisions
with respect for the results of such reports.
In addition, in the event that a Director or Executive Officer falls under any of the reasons for dismissal set forth by theCompany, such as significantly poor performance in the course of business, the Board of Directors consults in advance with
the Nomination Committee, a majority of which is composed of Independent Outside Directors, and makes decisions with

respect for the results of such reports. With regard to the dismissal of the President, the Board of Directors may hesitate topropose the dismissal of the President, which may hinder prompt decision-making. Therefore, if certain reasons are met, theNomination Committee may recommend and propose the dismissal of the President to the Board of Directors.
(v)

Explanation of individual selections, dismissals, and nominations when nominating Director candidates
Reasons for the nomination of each candidate for Director are provided in the Reference Documents for the General
Meeting of Shareholders. Furthermore, in the event of dismissal, the Company will disclose related information in the
Reference Documents for the General Meeting of Shareholders or via other appropriate methods.

[Supplementary Principle 3-1-3]
The Company has formulated the “RIKEN TECHNOS GROUP Sustainability Policy” as a basic policy on initiatives related tosustainability, and the Sustainability Committee are taking the lead in promoting related measures. Furthermore, the Sustainability
Committee consists of all Executive Officers and is chaired by the President & CEO, with Outside Directors also participating as
observers.
Furthermore, the “RIKEN TECHNOS GROUP Sustainability Policy” is published on the Company’s website.
https://www.rikentechnos.co.jp/e/csr/sustainability/policy
In the three-year Medium-Term Business Plan (April 2022 to March 2025), the Company sets forth “contributing to solving
environmental and social issues” as one of its strategies, and we are working to expand sales of environmentally friendly
materials while also addressing climate change issues and promoting initiatives related to the SDGs.
In addition, the Company has established specific strategies for investments in human capital and intellectual property, etc., in thethree-year Medium-Term Business Plan, and we are strengthening our efforts in this area.
The details of the three-year Medium-Term Business Plan are published on the Company’s website.
https://www.rikentechnos.co.jp/e/company/management_policy/
Details of the Company’s sustainability initiatives are provided in the section entitled “Approaches and Initiatives on
Sustainability” at the end of this report. The latest status of initiatives is published on the Company’s website.
https://www.rikentechnos.co.jp/e/csr/
In addition, we disclose information related to the impact of climate change risks and earnings opportunities on the Company’sbusiness activities, earnings, etc., on the Company’s website based on the TCFD framework.
https://www.rikentechnos.co.jp/e/csr/environment/climate/[Principle 4-1 Roles and Responsibilities of the Board of Directors (1)][Supplementary Principle 4-1-1]
The Company has adopted an Executive Officer System and promotes the considerable transfer of authority to execute operations.
By positioning the Management Committee as the main decision-making body for business execution, the Company has taken
steps to establish a flexible and strategic management system that can respond appropriately and promptly to rapid changes in thebusiness environment. The Board of Directors strengthens the monitoring and supervision of the management by focusing on the
deliberation of particularly important matters in the execution of business and the deliberation of matters of management
supervision such as the basic policy of management and governance, in addition to the matters stipulated by laws and regulations
and the Articles of Incorporation.
The Board of Directors, in addition to the “Regulations on the Board of Directors” and the “Regulations on the Management
Committee,” clearly defines the authority to make decisions according to the scale and nature of the business in internal
regulations such as the “Regulations on the Collective Decision-Making” and the “Regulations on the Management of RIKENTECHNOS GROUP Consolidated Subsidiaries,” and has established a system to enable efficient business execution.
[Principle 4-8 Effective Utilization of Independent Outside Directors]
The Company has elected three (3) Independent Outside Directors out of the four (4) Directors who are Audit & Supervisory
Committee Members, and currently has three (3) Independent Outside Directors out of the seven (7) Directors. In order tomaintain the transparency and soundness of management in the future, our policy is to elect Independent Outside Directors for atleast one-third of Directors.
In addition, the Company facilitates the exchange of information and the sharing of awareness among Outside Directors byholding a Board of Outside Directors meeting composed exclusively of Outside Directors at least once every six (6) months.
Furthermore, the primary Independent Outside Director has been selected by mutual voting between Independent Outside
Directors, and serves as the Chairperson of the Board of Outside Directors.
[Principle 4-9 Independence Standards and Qualifications of Independent Outside Directors]
When electing Outside Directors, the Company elects persons who satisfy the “Independence Standards for Outside Directors” set
forth by the Company, and who are capable of actively providing advice on management, supervising all aspects of management,
supervising conflicts of interest, and fulfilling the role of reflecting the opinions of stakeholders at meetings of the Board of
Directors.
In addition, when electing Outside Directors, the Company’s policy is for the Nomination Committee to deliberate and determine
their independence, and review the independence standards as necessary.
Furthermore, the “Independence Standards for Outside Directors” set forth by the Company are published on the Company’s
website as part of the “RIKEN TECHNOS GROUP Corporate Governance Policy.”
https://www.rikentechnos.co.jp/e/csr/governance/corporate-governance/[Principle 4-10 Utilization of Voluntary Systems][Supplementary Principle 4-10-1]
The Company has established the Nomination Committee and the Compensation Committee as voluntary advisory bodies to theBoard of Directors. In order to ensure the independence of these committees, Independent Outside Directors make up a majorityof their members. In addition, their Chairpersons are selected by mutual voting between members, from among Independent
Outside Directors.
< Authority and Role of the Nomination Committee >• Based on consultations of the Board of Directors, the Nomination Committee ensures the appropriateness of personnel
decisions made by the Board of Directors and enhances the transparency of such decisions by reporting on matters related
to the election and dismissal of Directors, Executive Officers, and consultants and advisors, matters related to theformulation and revision of the Independence Standards for Outside Directors, matters related to the formulation andoperation of succession plans for the Chief Executive Officer, etc., matters related to the creation and renewal of skill
matrices for the Board of Directors, and other matters.
• The Nomination Committee deliberates and decides on the contents of recommendations for the Board of Directors inconnection with the contents of the consultation of the Board of Directors.
• The Nomination Committee recommends and proposes the dismissal of the President to the Board of Directors in casesthat fall under specific reasons.
< Authority and Role of the Compensation Committee >• Based on consultations of the Board of Directors, the Compensation Committee ensures the appropriateness ofcompensation decisions of the Board of Directors and enhances the transparency of such decisions by reporting on
matters related to the contents of proposals concerning compensation, etc. for Directors to be submitted to the General
Meeting of Shareholders (including stock compensation), the compensation system (including stock compensation plan)for Directors (excluding Directors who are Audit & Supervisory Committee Members), Executive Officers, andconsultants and advisors, matters related to the contents of individual compensation, etc. (including stock compensation),and other matters.
• The Compensation Committee deliberates and decides on the contents of recommendations for the Board of Directors inconnection with the contents of the consultation of the Board of Directors.
[Principle 4-11 Prerequisites for Ensuring the Effectiveness of the Board of Directors][Supplementary Principle 4-11-1]
The Company’s Board of Directors consists of internal Directors who are broadly familiar with the Company’s business
operations and who have diverse expertise and experience. For Outside Directors, the Company elects independent persons who
have a high level of insight and abundant experience in management, thereby ensuring that objective supervision and advice on
all aspects of management can be obtained.
At present, the Board of Directors of the Company consists of seven (7) members, including three (3) Directors (excluding
Directors who are Audit & Supervisory Committee Members) and four (4) Directors who are Audit & Supervisory Committee
Members (including three (3) Independent Outside Directors). The Company will continue to strive to maintain an appropriate
size and composition for the Board of Directors, taking into account the balance of knowledge, experience, and abilities of theBoard of Directors as a whole, ensuring of diversity, the revitalization of deliberations, and other factors, in the context of theGroup’s global business operations.
The Company has prepared a skill matrix that lists each Director’s knowledge, experience, abilities, etc., and it is provided on the
final page of this report.
[Supplementary Principle 4-11-2]
The status of important concurrent positions held by each Director is disclosed in the Business Report, Reference Documents for
the General Meeting of Shareholders, and Annual Securities Report.
[Supplementary Principle 4-11-3](i) Methods of analysis and evaluation
In March 2024, a questionnaire (anonymous form) was administered to all Directors (9) regarding the evaluation of theeffectiveness of the Board of Directors for fiscal 2023. Based on the responses to the questionnaire survey, the effectivenesswas analyzed and evaluated, and future issues and initiatives were discussed at the regular Board of Directors meeting heldin April of the same year.
Based on the discussion mentioned above, the effectiveness evaluation of the Board of Directors for fiscal 2023 was
finalized at the regular Board of Directors meeting held in May of the same year.
[Key points of evaluation for fiscal 2023]① Advancement of internal control and company-wide risk management, ② relationships with shareholders andinvestors, and ③ promotion of initiatives to address sustainability issues
Furthermore, in addition to the above key points of evaluation, the Company’s policy is to check the following items every
year on an ongoing basis: ① results and issues of initiatives based on the results of the previous fiscal year’s evaluation ofeffectiveness; ② composition (Outside Directors), state of operation, and agenda of the Board of Directors; and ③ “selfevaluation” of the items required of individual Directors.
(ii) Summary of results of analysis and evaluation of effectiveness
The Company analyzed and evaluated that the Board of Directors of the Company as a whole is functioning properly andthat its effectiveness is sufficiently ensured. In particular, we confirmed that effectiveness has been ensured in the followingareas.
・At the Board of Directors meeting, sufficient materials were provided in terms of both quality and quantity, and theproceedings were conducted appropriately.
・With regard to important topics such as the publication of the Integrated Report and measures to improve corporate value(reduction of strategically held shares, balance sheet management, investment in human capital, etc.), there were sufficient
discussions at the Management Committee, where Outside Directors were also in attendance, and at the social gatherings of
Directors and Executive Officers.
・The understanding of the manufacturing work sites was deepened by visiting the factories and holding discussions with field
employees. In addition, in light of recent corporate issues, study sessions led by external lecturers were held in a timely andappropriate manner, effectively improving the knowledge and insights of Directors. (iii) Results and issues related to efforts
based on the results of the evaluation of effectiveness in the previous fiscal year
Based on the results of the evaluation of effectiveness in the previous fiscal year, the following measures were taken.
・Enhancing the Effectiveness of Group Control
Officers, including the Representative Director, visited consolidated subsidiaries in Japan and overseas to grasp the actual
situation of each company and provide direct guidance to strengthen the Group’s control. In addition, through the holding of
information-sharing meetings for consolidated subsidiaries and briefing sessions on the progress of the Medium-term
Business Plan for overseas subsidiaries, issues were identified and shared between the Company’s management and the
management of consolidated subsidiaries.
・Enhancing dialogue with shareholders and investors
We expanded our financial and non-financial disclosure by publishing the Integrated Report, incorporating sustainability
information into the Annual Securities Report, and disclosing measures to achieve management with an emphasis on stock
prices and capital costs. In addition, approaches have been advanced for constructive dialogue with shareholders andinvestors. The opinions of investors obtained in the SR meeting were reported and deliberated at the Management
Committee and the Board of Directors, and then reflected in various measures.
・Addressing Sustainability Issues
As guidelines for human capital and human rights initiatives, we formulated the Human Resource Development Policy, theInternal Environment Development Policy, and the Human Rights Policy. In addition, we appropriately supervised efforts toaddress issues related to sustainability by receiving reports on the progress of KPIs for materiality from the Sustainability
Committee. (iv) Issues to further improve effectiveness and details of future actions
The Company’s Board of Directors has confirmed that its effectiveness as a whole has been sufficiently secured. However,
the Company will continue to discuss the following points and strive to further improve its effectiveness.
・With regard to dialogue with shareholders and investors, the Company will continuously review the disclosure content
and discuss initiatives to further promote constructive dialogue, including disclosure of new information from both financial
and non-financial aspects. In addition, we will continue to appropriately reflect opinions obtained through dialogue in ourinternal structure.
・ We recognize that human capital is one of the Company s most important issues, and will pursue discussions inconjunction with our management strategy, with an eye toward the next Medium-term Business Plan.
・With regard to the restructuring of the business portfolio, discussions will be promoted, including a review of low-profit
businesses, while the allocation of management resources will be supervised from a medium- to long- term perspective.
[Principle 4-14 Training for Directors][Supplementary Principle 4-14-2]
The Company’s policy is to implement timely training tailored to each individual’s skills so that Directors can sufficiently fulfill
their expected roles, and provide them with adequate opportunities to understand the legal systems surrounding the Company,
their amendments, and the Company’s business, finance, organization, etc.
The Company implements new officer training for newly appointed internal Directors, and provides Outside Directors with
sufficient opportunities to receive the explanation of business activities of the Company, inspect each business office, etc. In
addition, outside lecturers hold seminars for all Directors on important themes such as governance and compliance on an annual
basis, in principle.
Furthermore, Directors who are Audit & Supervisory Committee Members are members of the Japan Audit & Supervisory Board
Members Association and participate in seminars and training sessions sponsored by the association to acquire and update thenecessary knowledge required as Audit & Supervisory Committee Members.
[Principle 5-1 Policy on Constructive Dialogue with Shareholders]
The policy on establishing systems and initiatives to promote constructive dialogue with shareholders is as follows:
・ The Executive Officer in charge of corporate planning shall supervise overall dialogue with shareholders, and take a variety of
initiatives, including Financial and Management Results Briefings and individual interviews for institutional investors so that
constructive dialogue can be realized.
・ The Company’s basic approach to dialogue with shareholders is for senior management, including the President and related
Executive Officers, and Directors, including Outside Directors, to attend dialogue with shareholders (briefings, interviews,etc.) and engage in direct dialogue with shareholders, to the extent reasonable in accordance with the objective and content of
the dialogue and the wishes of shareholders, etc.
In addition, the Company will establish a system to enable it to accurately address the wishes of shareholders and the main
matters of interest in interviews, through the appointment of a primary Independent Outside Director.
・ Related divisions within the Company (corporate planning, accounting, finance, general affairs & legal, etc.) that assist in the
dialogue shall work in cooperation with each other, such as jointly preparing various disclosure materials, etc. and providing

opportunities to share information and knowledge for Financial and Management Results Briefings every six (6) months.
・ In addition to ascertaining the shareholder structure on the register of shareholders, the Company shall identify beneficial
shareholders through shareholder identification surveys as necessary and utilize such information for necessary measures suchas IR activities.
・ As a means of dialogue other than individual interviews, Financial and Management Results Briefings for institutional
investors shall be held every six (6) months, and the progress of the Medium-Term Business Plan and other matters shall befully explained, and related materials shall be disclosed.
・ The opinions and concerns of shareholders identified through dialogue shall be reported to the Board of Directors, theManagement Committee, etc., as appropriate, and information shall be shared and utilized by related divisions.
・ The “Regulation on Insider Trading Prevention” shall be established to prohibit the transmission of material information thathas not been disclosed, and internal education on information management shall be periodically implemented.
[Dialogue with Shareholders]
Based on “Principle 5-1. Policy on Constructive Dialogue with Shareholders,” the Company promotes dialogue with shareholders
as follows.
(i) General Meeting of Shareholders
The Company fully recognizes that the General Meeting of Shareholders is the highest decision-making body of the Company
and also a place for constructive dialogue with shareholders, and thus strives to improve the environment from the perspective ofshareholders with voting rights.
<Results for Fiscal 2023>
・Disclosure of Sustainability Information in the Business Reports
・Full disclosure of the notice of convocation in English(ii) Dialogue with individual investors
We are working to enhance information disclosure on both financial and non-financial matters and to provide easy-to-understandexplanations.
<Results for Fiscal 2023>
・Issuance of shareholder newsletter (only available in Japanese): Twice・Revamping the corporate website (releasing the sustainability site and R&D site)(iii) Dialogue with institutional investors
Senior management, including the President and relevant Executive Officers, holds Financial and Management Results Briefings
for institutional investors, and conducts IR interviews and SR interviews with institutional investors and major shareholders inJapan.
In fiscal 2023, we held dialogue on the main themes: the Company’s management policies and strategies, and initiatives related tosustainability and corporate governance.
<Results for Fiscal 2023>
・Financial and Management Results Briefings held live online and at a venue: Twice・Individual IR meetings (including conference calls): 48 times
・SR interviews with major shareholders (April 2024): 10 times
・Publication of the Integrated Report
・Disclosure of sustainability information in the CG Reports and the Annual Securities Reports
・Simultaneous disclosure in English of the following materials: Consolidated Financial Results; Timely Disclosure; Financial
and Management Results Briefings; and Business Plan Briefing(iv) Status of feedback of opinions and concerns identified during the dialogue
Opinions obtained through dialogue with shareholders and investors are reported as appropriate at the Management Committee
and the Board of Directors meetings, and such information is shared among the relevant departments and incorporated
appropriately and effectively into corporate activities. We will continue to actively engage in dialogue with shareholders andinvestors while focusing on the above initiatives to further enhance our corporate value.
<Major Results from Dialogue in Fiscal 2023>
・Management with an emphasis on stock prices and capital costs
In response to requests for improving capital efficiency over the medium- to long- term and for disclosing growth strategies, we
disclosed specific initiatives to improve capital efficiency, growth strategies, and capital policies aimed at improving corporate
value.
At the Financial and Management Results Briefing held in May 2024, the Company disclosed the cost of equity - WACC, ROIC,
etc.
・Capital Policies and Financial Strategies
In response to requests for disclosure of policies related to capital policies and financial strategies, we disclosed our approach tothe balance sheet and cash allocation.
In the next Medium-term Business Plan, we plan to set out more specific amounts.
・Disclosure of Sustainability Information
In response to the opinion that we should disclose that we can contribute to solving environmental problems through our business,
we have released a more substantial sustainability website in addition to disclosing sustainability information in our Integrated
Reports, Business Reports, Annual Securities Reports, and other disclosure documents.
https://www.rikentechnos.co.jp/e/csr/
・Remuneration for Officers
In response to the opinion that performance-linked remuneration with an incentive function for officers should be evaluated on aconsolidated basis, we removed the non-consolidated performance-linked indicators from the performance-linked indicators of
performance-linked remuneration and also revised the weights for remuneration for execution of duties for fiscal 2024 onward.
Details are provided in “II. 1. [Director Remuneration] Disclosure of Policy on Determining Remuneration Amounts andCalculation Methods Thereof.”
・Skill Matrix of the Board of Directors
In response to the opinion that it is better to disclose the reasons for the selection of skills, we disclosed the “Relationshipbetween management strategies and skill items” and the “Definition of skills.” The revised skill matrix is provided at the end of
this report.
[Action to Implement Management that is Conscious of Cost of Capital and Stock Price] [English Translation Available]
In accordance with the request from Tokyo Stock Exchange regarding the “Action to Implement Management that is Conscious of
Cost of Capital and Stock Price”, the Company has disclosed the analysis and assessment of current situation, policies and targets
for improvement, and specific initiatives on the Company’s website.
https://www.rikentechnos.co.jp/e/ir/news/

2. Capital Structure
Foreign Shareholding Ratio

Status of Major Shareholders

10% or more and less than 20%
UpdatedName or Company Name
The Master Trust Bank of Japan, Ltd. (Trust Account)
Custody Bank of Japan, Ltd.
Shin-Etsu Chemical Co., Ltd.
Mizuho Bank, Ltd.
Resona Bank, Limited
Sompo Japan Insurance Inc.
Marubeni Corporation
Mitsubishi Corporation
MITSUI & CO., LTD.
Sumitomo Mitsui Banking Corporation
Name of Controlling Shareholder, if applicable(excluding Parent Company)
Name of Parent Company, if applicable

Number of Shares Owned
5,484,900
2,416,900
2,400,523
2,326,117
2,325,765
2,000,000
1,891,422
1,824,505
1,680,800
1,605,730

Percentage (%)
9.83
4.33
4.30
4.17
4.17
3.59
3.39
3.27
3.01
2.88

Not applicable

Supplementary Explanation-

3. Corporate Attributes
Listed Stock Exchange and Market Segment
Fiscal Year-End
Business Sector
Number of Employees (Consolidated) as of the Endof the Previous Fiscal YearNet Sales (Consolidated) as of the End of thePrevious Fiscal Year
Number of Consolidated Subsidiaries as of the Endof the Previous Fiscal YearTSE Prime
March
Chemicals
1,000 or more
¥100 billion or more and less than ¥1 trillion
10 or more and fewer than 50

4. Policy on Measures to Protect Minority Shareholders in Conducting Transactions with Controlling
Shareholder-

5. Other Special Circumstances which May have Material Impact on Corporate Governance-

II. Business Management Organization and Other Corporate Governance Systems regarding
Decision-making, Execution of Business, and Oversight in Management
1. Organizational Composition and Operation
Corporate Governance System

Company with Audit and Supervisory Committee

Directors
Number of Directors Stipulated in Articles ofIncorporation
Directors’ Term of Office Stipulated in Articles ofIncorporation
Chairperson of the Board
Updated1 yearPresident
7

Number of Directors
Election of Outside Directors
Number of Outside Directors

12 / No upper limit

Elected3

UpdatedNumber of Independent Directors

Updated3

Outside Directors’ Relationship with the Company (1)NameUpdatedRelationship with the Company*
c
d
e
f
g
h
i
△
△

AttributesabjkShigeharu Nakamura
From another company
Shigeru Ehara
From another company○
Aogi Suemura
Certified public accountant*Categories for “Relationship with the Company”.
(Use “ ” when the Director presently falls or has recently fallen under the category; “ ” when the Director fell under the category
in the past; “ ” when a close relative of the Director presently falls or has recently fallen under the category; and “ ” when aclose relative of the Director fell under the category in the past.)
a. Person who executes business of the Company or a subsidiary
b. Person who executes business or a non-executive Director of a parent company
c. Person who executes business of a fellow subsidiaryd. Person/entity for which the Company is a major client or a person who executes business for such person/entity
e. Major client of the Company or a person who executes business for such clientf. Consultant, accounting expert, or legal expert who receives large amounts of cash or other assets in addition to Director/Audit
and Supervisory Board Member compensation from the Company
g. Major shareholder of the Company (in cases where the shareholder is a corporation, a person who executes business of thecorporation)h. Person who executes business for a client of the Company (excluding persons categorized as any of d, e, or f above) (applies toself only)
i. Person who executes business for another company holding cross-directorships/cross-auditorships with the Company (applies
to self only)
j. Person who executes business for an entity receiving contributions from the Company (applies to self only)
k. OtherOutside Directors’ Relationship with the Company (2)Name

Shigeharu
Nakamura

Membership ofSupervisory
Committee

Designation as
Independent
Director

UpdatedSupplementary Explanation of
the Applicable Relationship(Career summary)
April

1976

Reasons for Appointment(Reasons for appointment andreasons for designation as anJoined The Saitama Bank,Ltd.
(current
SaitamaResona Bank, Limited)
June
2005
Managing
Executive
Officer in charge ofFinance Div., Resona Bank,
LimitedJune
2006
Director, Senior Managing
Executive Officer in chargeof Finance Div. and in
chargeofCorporate
Governance Office
June
2008
Representative
Director,
Vice
President,&
Executive Officer in chargeof
Human
Resources
Division and in charge ofCorporate
Governance
Secretariat (Retired in
March 2012)
April
2012
Representative Director &President, Resona ResearchInstitute Co., Ltd.
June
2013
Outside Auditor, TOYOKANETSU K.K.
April
2014
Advisor, Resona ResearchInstitute Co., Ltd. (Retired
in June 2014)
June
2014
Auditor, F-TECH INC.
(Retired in June 2022)
Outside Corporate Auditor,
RIKEN
TECHNOSCORPORATION
June
2015
Outside Director (Audit &Supervisory
Committee
Member),TOYO
KANETSUK.K.
(topresent)
June
2016
Outside Director serving as
Audit&
Supervisory
Committee Member (topresent)
June
2018
External Director, The
Shoko Chukin Bank, Ltd.
(Retired in June 2024)
As
described
above,
Mr.
Shigeharu
NakamurawasRepresentative Director, Vice
President, & Executive Officer ofResona Bank, Limited, which has
transactions with the Company.
The Company borrowed funds
from Resona Bank, Limited in

Independent Director)
Mr. Shigeharu Nakamura has
many years of experience as an
officer responsible for risk
management
andcorporate
governance at leading commercial
banks, as well as deep insight into
management derived from his
experience as a corporate
executive at each company.
He has provided wide-ranging
and objective audits and advice tothe management as an Outside
Corporate
AuditoroftheCompany from June 2014 and as
an Outside Director serving as
Audit & Supervisory Committee
Member from June 2016. The
Company elected him as an
Outside Director serving as Audit&
Supervisory
Committee
Member because we believe that
he will continue to contribute to
the auditing and supervision of
the Group’s management.
Mr. Nakamura has a backgroundat Resona Bank, Limited, afinancial institution with which
the Company has transactions, but
he retired in March 2012, and heis therefore not in a position to be
influenced by its intentions.
The Company has transactions
with several financial institutions,and deposit and borrowing
transactions
betweentheCompany and Resona Bank,
Limited are based on a generally
fair and reasonable transactional
relationship. In addition, thedegreeofdependenceonborrowings from Resona Bank,
Limited is not significant, and theCompany has therefore judgedthat he is independent.
Furthermore, Mr. Nakamura has
no conflict of interest withgeneral shareholders.

the fiscal year ended March 31,
2024, but the amount ofborrowings from Resona Bank,
Limited as a percentage ofconsolidated total assets was
1.9% (rounded down to one
decimal place).
Shigeru Ehara(Career summary)
April
1981
Joined The Yasuda Fire &Marine Insurance Co., Ltd.
April
2011
Executive Officer, General
Manager, Commercial Risk
Solutions
Department,
Sompo Japan Insurance
Inc.
April
2013
Director,
Managing
Executive Officer, Sompo
Japan
Insurance
Inc.
Managing
Executive
Officer,
NIPPONKOA
Insurance
Company,
Limited
Executive Officer, NKSJ
Holdings, Inc.
June
2013
Director, Executive Officer,
NKSJ Holdings, Inc.
September
2014
Director,
Managing
Executive Officer, Sompo
Japan Nipponkoa InsuranceInc.
Director,
Managing
Executive Officer, Sompo
Japan Nipponkoa Holdings,
Inc.
April
2016
Director, Senior Managing
Executive Officer, Sompo
Japan Nipponkoa InsuranceInc.
Director, Senior Managing
Executive Officer, Sompo
Japan Nipponkoa Holdings,
Inc.
November
2016
Representative
Director,
Senior Managing Executive
Officer, Sompo Holdings,
Inc.
April
2017
CEO, Overseas Insurance
and Reinsurance Business,
Representative
Director,
Senior Managing Executive
Officer
April
2018
DeputyPresident
andSenior Executive Officer,
Sompo Japan Nipponkoa
Insurance Inc. (Retired in
June
2018)

(Reasons for appointment andreasons for designation as an
Independent Director)
Mr. Shigeru Ehara has deep
insight into management derived
fromhis
involvementincompanies in various types ofbusinesses and industries throughhis experience working incasualty insurance companies andworking as a corporate executive.
He
also
has
considerable
knowledge in global corporate
management
throughhisextensiveoverseas
workexperience. He has provided
wide-ranging and objective audits
and advice to the management as
an Outside Director serving as
Audit & Supervisory Committee
Member since June 2022. The
Company elected him as an
Outside Director serving as Audit&
Supervisory
Committee
Member because we believe that
he will continue to contribute to
the auditing and supervision of
the Group’s management.
Mr. Ehara has a background at
Sompo
Japan
Nipponkoa
Insurance Inc. (current Sompo
Japan Insurance Inc.), with which
the Company has transactions, but
he retired in June 2018, and he istherefore not in a position to be
influenced by its intentions.
Furthermore, Mr. Ehara has noconflict of interest with generalshareholders.

Director, Deputy President
andSeniorExecutive
Officer, Sompo Holdings,
Inc. (Retired in June 2018)
June
2018
Executive Director, General
Insurance
RatingOrganization of Japan(Retired in June 2022)
June 2022
Outside Director serving as
Audit&
Supervisory
Committee
Member,RIKEN
TECHNOSCORPORATION(topresent)
Notes:
1. The Yasuda Fire & Marine
Insurance Co., Ltd., Sompo
Japan
InsuranceInc.,
NIPPONKOA
Insurance
Company, Limited, andSompo Japan Nipponkoa
Insurance Inc. are currently
named as Sompo Japan
Insurance Inc.
2.
NKSJ Holdings, Inc. andSompo Japan Nipponkoa
Holdings Inc. are currently
named as Sompo Holdings,
Inc.
As described above, Mr. Shigeru
Ehara was an Executive Officerof Sompo Japan Nipponkoa
Insurance Inc. (current Sompo
Japan Insurance Inc.), which has
transactions with the Company.
The Company has entered into acasualty insurance policy with
Sompo Japan Insurance Inc., but
the transaction amount is
insignificant.
Aogi Suemura(Career summary)
October
1992
Joined Asahi Shinwa & Co.
(current KPMG AZSA
LLC)
April
1996
Registered as certified
public accountant
August1999
Joined GOLDCREST Co.,Ltd.
January
2002
Joined Sumitomo Shoji
Financial Management Co.,Ltd.
November
2004
Joined Deloitte Touche
Tohmatsu (current Deloitte
Touche Tohmatsu LLC)
June
2008

(Reasons for appointment andreasons for designation as an
Independent Director)
Ms. Aogi Suemura has engaged inoperations such as supporting
developmentof
statutory
audit/internal control systems forlisted companies as a partner of amajor audit corporation, andexperienced
mainlyinconsolidated financial reporting
operations and M&A accounting
at major companies as well. She
also has extensive knowledge andexperiencein
corporateaccounting and management as acertified public accountant. She
has provided wide-ranging andobjective audits and advice to the
management as an Outside
Director serving as Audit &Partner
January2022
Representative,
Aogi
Suemura Certified Public
Accountant
Firm(topresent)
June 2022
Outside Director serving as
Audit&
Supervisory
Committee
Member,RIKEN
TECHNOSCORPORATION(topresent)
March 2023
Outside
Audit&
Supervisory
Board
Member, Nippon Denko
Co., Ltd.
March 2024
Outside Director (Audit &Supervisory
Committee
Member) (to present)
June 2024
Outside Director (Audit &Supervisory
Committee
Member), Nomura Real
Estate Holdings, Inc. (topresent)

Supervisory Committee Member
since June 2022. The Company
elected her as an Outside Director
serving as Audit & Supervisory
Committee Member because webelieve that she will continue tocontribute to the auditing andsupervision of the Group’s
management.
Although she has not been
involved
incorporate
management in any way otherthan being an outside director,
based on the above reasons, theCompany has judged that she canappropriately perform her duties
as an Outside Director serving as
Audit & Supervisory Committee
Member.
Furthermore, Ms. Suemura has noconflict of interest with generalshareholders.

Supervisory Committee
Composition of Supervisory Committee and Attributes of the Chairperson
All Committee
Members
Supervisory
Committee

Full-time Members
4

Appointment of Directors and/or Staff to Support theSupervisory Committee

1

UpdatedInside Directors

Outside Directors
1

3Committee Chair
Inside Director

Appointed

Matters Concerning Independence of Said Directors and/or Employees from Executive Officers
The Audit Department is set up as an organization under the direct control of the Audit & Supervisory Committee to assist the
Audit & Supervisory Committee in performing its duties, and several dedicated employees are appointed to the Audit
Department. To ensure the independence of these employees, all rights to command and order them are delegated exclusively to
the Audit & Supervisory Committee, and these employees are not commanded or ordered by departments conducting business
operations or any of the Directors (excluding Directors serving as Audit & Supervisory Committee Members). In addition, any
decision on a personnel transfer, personnel evaluation, or disciplinary measures, etc. for these employees is made subsequent tothe approval from the Audit & Supervisory Committee.

Status of Coordination between Supervisory Committee, Accounting Auditor, and Internal Audit Department
The Audit & Supervisory Committee takes steps to ensure close cooperation with the Accounting Auditors, including receiving
regular explanations of audit plans and reports on audit results from the Accounting Auditors, and obtaining information on thestatus of audits as appropriate during the fiscal year. In addition, the Audit Department, which is the internal audit department,
reports directly to the Audit & Supervisory Committee. As such, the Company has established a system that enables it to conduct
systematic and effective audits using internal control systems, through clear orders and instructions from the Audit & Supervisory
Committee to the Audit Department and reporting systems, as well as joint audits in Japan and overseas as necessary. The Audit
Department has built an effective dual reporting line, which reports the status of internal audits to the Audit & Supervisory

Committee as well as the Management Committee and the Board of Directors and makes monthly regular reports to theRepresentative Director, President & CEO.
The Audit & Supervisory Committee, Accounting Auditors, and Audit Department hold meetings to exchange views every six (6)months, and a system is therefore in place for the multifaceted exchange of information related to various management issues.

Voluntary Established Committee(s)Voluntary Establishment of Committee(s) equivalent toNomination Committee or Remuneration Committee

Established

Status of Voluntarily Established Committee(s), Attributes of Members Constituting the Committee and the Committee
Chair (Chairperson)

UpdatedCommittee’s
Name
Voluntarily
Established
Committee
Equivalent toNomination
Committee
Voluntarily
Established
Committee
Equivalent toRemuneration
Committee

All
Members

Full-timeMembers

InsideDirectors

OutsideDirectors

OutsideExperts

Nomination
Committee

5

0

2

3

0

0

Outside Director

Compensation
Committee

5

0

2

3

0

0

Outside Director

Supplementary Explanation

Other

Chairperson

UpdatedThe Company has established the Nomination Committee and the Compensation Committee as voluntary advisory bodies to theBoard of Directors. Both committees seek to substantiate discussions by including multiple Inside Directors as members inconsideration of their skills, etc. At the same time, a majority of members of the committees are Independent Outside Directors toensure transparency and objectivity in the process and content of nominations and remuneration. In addition, their Chairpersons
are selected by mutual voting between members, from among Independent Outside Directors.
When nominating candidates for Directors and selecting Executive Officers, and when making decisions concerning thecompensation of Directors (excluding Directors who are Audit & Supervisory Committee Members) and Executive Officers, theBoard of Directors consults in advance with the Nomination Committee concerning the nomination of Director candidates and theselection of Executive Officers and the Compensation Committee concerning the compensation of Directors (excluding Directors
who are Audit & Supervisory Committee Members) and Executive Officers, and makes decisions with respect for the results ofthese committees’ reports.
In fiscal 2023, the Nomination Committee held three (3) meetings chaired by Outside Director (Audit & Supervisory Committee
Member) Takayuki Hayakawa, and it deliberated on matters such as the selection of candidates for Directors (excluding Directors
who are Audit & Supervisory Committee Members) and Executive Officers, as well as succession plans. The Compensation
Committee held three (3) meetings chaired by Outside Director (Audit & Supervisory Committee Member) Shigeharu Nakamura,and it deliberated on matters such as individual compensation for Directors (excluding Directors who are Audit & Supervisory
Committee Members) and Executive Officers (basic compensation, performance-linked bonuses, and stock benefits).
The attendance of each Committee member at both Committees’ meetings is provided in “Attendance of Individual Directors” at
the end of this report.

Matters Concerning Independent Directors
Number of Independent Directors

Updated

3

Other Matters Concerning Independent Directors
The Company designates all outside officers who meet the qualifications for independent officers as independent officers.
Independence Standards for Outside Directors of the Company are described below.

The Company deems that Outside Directors of the Company are independent if they are judged not to fall under any of thefollowing:
1. A person who has been an Executive (*1) of the Company or subsidiaries of the Company (hereinafter referred to as “EachGroup Company”) at present or in the most recent ten (10) years;
2. A person who falls under the following items at present or in the most recent three (3) business years:(1) A person with a relationship with major business partners of Each Group Company (*2) or an Executive thereof;(2) A major borrower (*3) of Each Group Company or an Executive thereof;(3) A major shareholder of the Company (*4) (if such major shareholder is a juridical person, a person who is an Executive of thejuridical person);(4) A consultant, accounting specialist, legal specialist, etc. who has received a large amount of money or other property (*5) from
Each Group Company in addition to compensation for officers (if a person who has received such property is an organization suchas a juridical person or association, the person belonging to such organization);(5) A person who belongs to an auditing firm that is the Accounting Auditor of Each Group Company;(6) An Executive of a party under mutual appointment as Outside Officer; or(7) A person receiving a large amount of donations or grants (*6) from Each Group Company or an Executive thereof.
3. A spouse or relative within the second degree of kinship of a person who falls under any of the items of 1 or 2 above; or
4. A person whose total term of office as an Outside Director of the Company exceeds ten (10) years.
(Notes)*1 An Executive includes a Director, Corporate Officer, Executive Officer, manager, or other employees who execute the businessof a juridical person or other organizations.
*2 Relationship with major business partners is defined as the case in which the total amount of transactions with Each Group
Company accounts for two percent (2%) or more of consolidated sales (average for the most recent (3) business years) in either of
the Company or business partners (including their parent company and significant subsidiaries) in the most recent (3) businessyears.
*3 A major borrower is defined as the case where the total amount of borrowings by Each Group Company accounts for two
percent (2%) or more of the total consolidated assets (average for the most recent (3) business years) as of the last day of the mostrecent (3) business years.
*4 A major shareholder means a person who holds ten percent (10%) or more of the total voting rights directly or indirectly.
*5 A large amount of money or other property means ten million (10,000,000) yen or more per year.
*6 Large amount of donations or grants means ten million (10,000,000) yen or more per year.

Incentives
Implementation Status of Measures related toIncentives Granted to Directors

Introduction of Performance-linked Remuneration Scheme

Supplementary Explanation for Applicable Items
Compensation for Directors (excluding Directors who are Audit & Supervisory Committee Members) consists of executive
compensation and supervisory compensation.
Executive compensation consists of a fixed amount of basic compensation (cash) and bonuses as performance-linked
compensation (cash and stock benefits). Supervisory compensation consists of a fixed amount of basic compensation (cash) and afixed amount of stock benefits.
Policies for determining the content of compensation, etc., for individual Directors are described in “II. 1. Organizational

Composition and Operation [Director Remuneration] Disclosure of Policy on Determining Remuneration Amounts and the
Calculation Methods Thereof” of this report.

Persons Eligible for Stock Options

Supplementary Explanation for Applicable Items-

Director Remuneration
Status of Disclosure of Individual Directors’
Remuneration

Supplementary Explanation for Applicable Items

No Disclosure for any Directors
Updated

1. Compensation, etc. for Fiscal 2023 (95th Fiscal Year)
Directors (excluding Audit & Supervisory Committee Members) (excluding Outside Directors): 4
Total: 198,488 thousand yen (basic compensation: 116.219 thousand yen, bonuses (cash): 51,789 thousand yen, bonuses(stock benefits): 15,318 thousand yen, fixed stock benefits: 15,161 thousand yen)
Directors (Audit & Supervisory Committee Members) (excluding Outside Directors): 1
Total: 17,691 thousand yen (basic compensation: 16,200 thousand yen, bonuses (cash): – yen, bonuses (stock benefits): –yen, fixed stock benefits: 1,491 thousand yen)
Outside Directors (Audit & Supervisory Committee Members): 4
Total: 39,313 thousand yen (basic compensation: 36,000 thousand yen, bonuses (cash): – yen, bonuses (stock benefits): –yen, fixed stock benefits: 3,313 thousand yen)
Notes:
1) The maximum amount of compensation for Directors (excluding Audit & Supervisory Committee Members) was resolved
at the 87th Ordinary General Meeting of Shareholders held on June 24, 2016, to be no more than 250 million yen per year(including compensation for duties performed as Executive Officers by Directors serving concurrently as Executive
Officers). The number of Directors (excluding Audit & Supervisory Committee Members) at the conclusion of thisOrdinary General Meeting of Shareholders was four (4).
Furthermore, the corresponding amount of compensation, etc., for Directors (excluding Audit & Supervisory Committee
Members) for fiscal 2023 (the 95th fiscal year) was 168,008 thousand yen (basic compensation: 116,219 thousand yen,bonuses (cash): 51,789 thousand yen).
2) The maximum amount of compensation for Directors (Audit & Supervisory Committee Members) was resolved at the 87th
Ordinary General Meeting of Shareholders held on June 24, 2016, to be no more than 60 million yen per year. The
number of Directors (Audit & Supervisory Committee Members) at the conclusion of this Ordinary General Meeting of
Shareholders was four (4). Furthermore, the corresponding amount of compensation, etc., for Directors (Audit &Supervisory Committee Members) for fiscal 2023 (the 95th fiscal year) was 52,200 thousand yen (basic compensation for
Directors (Audit & Supervisory Committee Members) (excluding Outside Directors): 16,200 thousand yen, basic
compensation for Outside Directors: 36,000 thousand yen).
3) Separately to the amounts of remuneration in the items 1) and 2) above, at the 87th Ordinary General Meeting of
Shareholders held on June 24, 2016, a resolution was adopted to introduce a stock-based compensation plan “Board
Benefit Trust (BBT),” and at the 92nd Ordinary General Meeting of Shareholders held on June 18, 2021, a resolution was
adopted to make partial revisions to this plan. Under this stock-based compensation plan, for each period of three (3)fiscal years starting from the fiscal year ended March 31, 2017, the Company will establish a trust with the contribution of
cash of up to 210 million yen (including 150 million yen for Directors (excluding Audit & Supervisory Committee
Members), 18 million yen for Directors (Audit & Supervisory Committee Members), and 42 million yen for Executive
Officers who do not serve concurrently as Directors) as funds necessary for the acquisition of shares corresponding to thethree (3) fiscal years. The number of Directors (excluding Audit & Supervisory Committee Members) was five (5) and thenumber of Directors (Audit & Supervisory Committee Members) was four (4) at the conclusion of the 92nd Ordinary
General Meeting of Shareholders held on June 18, 2021.
4) The total amount of compensation, etc., for Directors (excluding Audit & Supervisory Committee Members) (excluding
Outside Directors) includes 109,800 thousand yen in compensation for duties performed as Executive Officers by
Directors serving concurrently as Executive Officers.
5) The total amount of compensation, etc., for Directors (excluding Audit & Supervisory Committee Members) (excluding
Outside Directors) includes provisions of 30,479 thousand yen for the Board Benefit Trust (BBT) and 51,789 thousand
yen in provisions for officers’ bonuses, recorded in fiscal 2023 (the 95th fiscal year).
6) The total amount of compensation, etc., for Directors (Audit & Supervisory Committee Members) (excluding Outside
Directors) includes provisions of 1,491 thousand yen for the Board Benefit Trust (BBT), recorded in fiscal 2023 (the 95th
fiscal year).
7) The total amount of compensation, etc., for Outside Directors (Audit & Supervisory Committee Members) includes

provisions of 3,313 thousand yen for the Board Benefit Trust (BBT), recorded in fiscal 2023 (the 95th fiscal year).
2. Amount of Compensation, etc., Paid for Fiscal 2023 (95th Fiscal Year) Other than the Above Item 1.
The Company paid a total of 73,184 thousand yen (55,366 thousand yen in cash and 17,818 thousand yen in stock benefits) to
4 Directors (excluding the Audit & Supervisory Committee Members) as bonuses (cash and stock benefits) for fiscal 2023
(the 95th fiscal year).
This amount includes provisions of 47,607 thousand yen for officers’ bonuses and 13,661 thousand yen in provisions for the
Board Benefit Trust (BBT) recorded in the relevant fiscal year.
Policy on Determining Remuneration Amounts andthe Calculation Methods Thereof

UpdatedEstablished

Disclosure of Policy on Determining Remuneration Amounts and the Calculation Methods Thereof< Policy for Determining Individual Compensation, etc., for Directors >1. Basic Policy
Compensation for Directors (excluding Directors who are Audit & Supervisory Committee Members) is set at an appropriate
level of compensation in accordance with the positions and responsibilities of Directors, based on a compensation plan that
motivates Directors to improve business performance in each fiscal year and improve corporate value over the medium tolong term, while also enabling them to share value with shareholders. To ensure objectivity and transparency when
determining these levels, respect is shown to the opinions of the Compensation Committee, where more than half of themembers are Independent Outside Directors.
Specifically, compensation for Directors (excluding Directors who are Audit & Supervisory Committee Members) consists ofexecutive compensation and supervisory compensation. Executive compensation consists of a fixed amount of basic
compensation (cash) and bonuses as performance-linked compensation (cash and stock benefits). Supervisory compensationconsists of a fixed amount of basic compensation (cash) and a fixed amount of stock benefits.
2. Policy for Determining the Amount of Individual Compensation, etc., for Basic Compensation (Including Policies Related to
Determining the Timing or Terms of Compensation, etc.)
Of executive compensation for Directors (excluding Directors who are Audit & Supervisory Committee Members), basic
compensation consists of fixed compensation paid monthly as cash, after the amount of individual compensation isdetermined for the current fiscal year based on the basic compensation standards in accordance with position and rank(evaluation), and adjusted for the Company’s performance (consolidated) in the case of those who serve concurrently as
Executive Officers with special titles of Managing Executive Officer or higher, and adjusted for their responsibilities in thecurrent fiscal year, the expected level of performance in the departments under their supervision, and their expected level ofcontribution to the company-wide strategy in the case of other Directors (excluding Directors serving as Audit & Supervisory
Committee Members).
In addition, of supervisory compensation, basic compensation consists of fixed compensation paid monthly as cash, after theamount of individual compensation is determined in accordance with whether or not the Director has the authority ofrepresentation.
3. Policy for Determining the Calculation Method for the Content, Amount, and Number of Performance-Linked Compensation(Including Policies Related to Determining the Timing or Terms of Compensation, etc.)
Bonuses (cash and stock benefits) paid as individual performance-linked compensation for Directors (excluding Directors
who are Audit & Supervisory Committee Members) is calculated by adjusting the amount of basic bonuses, which is set basedon basic compensation (cash) as a component of individual executive compensation, for the level of achievement of thefollowing performance-linked indicators for the relevant fiscal year, and a certain percentage of the bonuses is paid as stock
benefits according to the position of the Director. Furthermore, bonuses are paid in July of each year.
Performance-linked indicators consist of company performance indicators and individual performance indicators. However,
performance-linked indicators for Directors who serve concurrently as Executive Officers with special titles of Managing
Executive Officer or higher consist only of company performance indicators.
Company performance indicators are calculated using consolidated operating profit, consolidated ordinary profit, andconsolidated ROE, to ensure that compensation is linked to the level of achievement of the Company’s business performancein relation to the enhancement of corporate value and shareholder value, while individual performance indicators arecalculated using the performance of departments under supervision and contribution to the company-wide strategies.
4. Policy for Determining the Calculation Method for the Content, Amount, and Number of Non-cash Compensation (Including
Policies Related to Determining the Timing or Terms of Compensation, etc.)
Stock benefits (performance-linked compensation as a component of executive compensation and supervisory compensation),
which are a form of non-cash compensation for Directors (excluding Directors who are Audit & Supervisory Committee
Members), consist of a Board Benefit Trust (BBT). Points corresponding to the amount of compensation are granted in July ofeach year, and a number of stock benefits corresponding to the number of points is paid upon retirement.
Stock benefits paid as performance-linked compensation are determined as described in the above item 3., while stock
benefits paid as supervisory compensation are a fixed amount, determined in accordance with whether or not the Director has

the authority of representation.
5. Policy for Determining the Ratio of the Amount of Cash Compensation, the Amount of Performance-Linked Compensation,etc., and the Amount of Non-cash Compensation, etc. to the Amount of Individual Compensation, etc., for Directors
With regard to compensation for Directors (excluding Directors serving as Audit & Supervisory Committee Members), foreach individual, the ratio of the amount of cash compensation excluding performance-linked compensation (basic
compensation as a component of executive compensation and basic compensation as a component of supervisorycompensation), the amount of bonuses paid as performance-linked compensation (cash and stock benefits) and the fixedamount of stock benefits, is approximately 6:3:1, assuming that the level of achievement for performance-linked
compensation is 100%.
For each individual, the ratio of the amount of cash compensation excluding performance-linked compensation for Directors(excluding Directors who are Audit & Supervisory Committee Members) (basic compensation as a component of executive
compensation and basic compensation as a component of supervisory compensation) and bonuses paid as performance-linked
compensation (cash and stock benefits) is approximately 7:3, assuming that the level of achievement for performance-linked
compensation is 100%.
In addition, for each individual, the ratio of the amount of cash compensation excluding performance-linked compensation(basic compensation as a component of executive compensation and basic compensation as a component of supervisorycompensation) and stock-based compensation (fixed stock-based compensation and stock-based compensation paid asperformance-linked compensation) is approximately 8:2, assuming that the level of achievement for performance-linked
compensation is 100%.
Furthermore, the individual ratios of the amounts of compensation are revised as appropriate by the Board of Directors after
consulting with the Compensation Committee, based on any changes in compensation levels, etc.
6. Policy for Reducing and Repaying the Amount of Compensation (malus and clawback provision)
If there is a material error in the financial statements or a material accounting irregularity, or if Directors (excluding Directors
serving as Audit & Supervisory Committee Members) violate laws, regulations, or the Articles of Incorporation, etc., theCompany shall be able to demand a reduction of the amount of compensation or the repayment of compensation paid.
The specific amount of the reduction or repayment demanded shall be determined by the Board of Directors after consultingwith the Compensation Committee, with respect for the results of such reports.
7. Matters Related to the Determination of Individual Compensation, etc., for Directors
The details of the compensation system and individual compensation, etc., for Directors (excluding Directors who are Audit& Supervisory Committee Members), are determined by the Board of Directors after consulting in advance with theCompensation Committee, a majority of which is composed of Independent Outside Directors, with respect for the results ofsuch reports.

Support System for Outside Directors
1. The Company has ensured a support system for Outside Directors is in place, as follows.
1) In principle, the Company distributes materials prior to meetings of the Board of Directors and provides explanations inadvance as appropriate.
2) The Company takes steps to ensure that information is shared by having Outside Directors attend important meetings suchas the Management Committee and distributing minutes, etc., as appropriate.
3) The Audit & Supervisory Committee, Accounting Auditors, and Audit Department hold joint meetings to exchange
opinions every six (6) months, and a system is therefore in place for the multifaceted exchange of information related tovarious management issues.
4) One or more Full-time Audit & Supervisory Committee Members are appointed to promptly gather information within the
Company and work closely with Outside Directors to share information.
5) The Audit Department is set up as an organization under the direct control of the Audit & Supervisory Committee to assist
the Audit & Supervisory Committee, and several dedicated employees are appointed to the Audit Department.

2.

Matters Concerning Functions of Business Execution, Auditing and Supervision, Nomination, andRemuneration Decisions (Overview of Current Corporate Governance System)

UpdatedTo strengthen the supervisory function of the Board of Directors, the Company has adopted the format of a company with an audit
and supervisory committee.
1. Execution of Business Operations
The Company has adopted an Executive Officer System, thereby separating management decision-making and supervisory
functions from business execution functions, and also promoting the considerable transfer of authority to execute operations.
In this way, the Company has taken steps to establish a flexible and strategic management system. Accordingly, theManagement Committee, which consists of Executive Officers, is positioned as the main decision-making body for the
execution of business operations.
Meetings of the Management Committee are held ahead of Board of Directors meetings each month to deliberate beforehandissues being put forth to the Board of Directors as well as to deliberate and decide on the execution of important tasks forwhich authority has been delegated by the Board of Directors, thereby ensuring prompt decision-making. In addition, theCompany has established the Executive Officers Committee for the purpose of communicating matters to be resolved,
deliberated, and reported at meetings of the Board of Directors, as well as communicating and sharing information between
Executive Officers. This committee meets within a certain period of time after the Board of Directors meeting every month.
2. Audits and Supervision
1) The primary role of the Board of Directors of the Company is to review and deliberate matters of management supervision,
such as basic management policies and governance. By electing Independent Outside Directors for at least one-third of
positions on the Board of Directors, the Company strengthens supervisory functions and enhances the effectiveness ofsupervision. In fiscal 2023 (the 95th fiscal year), the Board of Directors met 16 times, and it deliberated on matters such as
governance and other matters of management supervision, Progress of Materiality Topic KPIs, publication of the Integrated
Report, verification of the appropriateness of holding strategic-holding shares, repurchase and cancellation of own shares,
progress and review of succession plans, etc.
The Board of Directors also met at factories to discuss predetermined topics with on-site employees and conduct site visits.
The attendance of each Director is provided in “Attendance of Individual Directors” at the end of this report.
2) The Audit & Supervisory Committee consists of four (4) members, including three (3) Outside Directors, and the Company
has appointed a Full-time Audit & Supervisory Committee Member to promptly gather information within the Company
and work closely with Outside Directors to share information. In addition, the Company has also established the Audit
Department as a department reporting directly to the Audit & Supervisory Committee. As such, the Company has
established a system that enables it to conduct systematic and effective audits using internal control systems, throughclearly establishing systems for orders and instructions from the Audit & Supervisory Committee to the Audit Department,
and reporting systems.
Audit & Supervisory Committee Members attend meetings of the Board of Directors and other important meetings such as
the Management Committee, and strictly monitor the execution of duties by Directors by inspecting important approval
documents and other methods.
The attendance of each Audit & Supervisory Committee Member at the Audit & Supervisory Committee meetings isprovided in “Attendance of Individual Directors” at the end of this report.
In addition, the Audit & Supervisory Committee takes steps to ensure close cooperation with the Accounting Auditors,
including receiving explanations of audit plans, information about the status of audits, and reports on audit results from the
Accounting Auditors, and holding joint meetings to exchange opinions between the Audit & Supervisory Committee, the
Accounting Auditors, and the Audit Department every six (6) months.
3) The Accounting Auditors of the Company are Ernst & Young ShinNihon LLC, and the names of the certified public
accountants who performed these services in fiscal 2023 (the 95th fiscal year) and the composition of assistants related toaudit services are as follows. The Company and Ernst & Young ShinNihon LLC have entered into an audit agreement
pursuant to the provisions of the Companies Act and the Financial Instruments and Exchange Act.
Names of certified public accountants who performed services
Hideyuki Inoue, Designated Limited Liability Partner and Executive Partner (years of continuous audits: 3)
Kazunori Yoshida, Designated Limited Liability Partner and Executive Partner (years of continuous audits: 1)
Composition of assistants related to audit services
Certified public accountants: 7, others: 24
3. Nomination and Compensation Decisions
1) When nominating candidates for Directors and selecting Executive Officers, the Board of Directors consults in advancewith the Nomination Committee, a majority of which is composed of Independent Outside Directors, and makes decisions
with respect for the results of such reports.
In fiscal 2023, the Nomination Committee held three (3) meetings chaired by Outside Director (Audit & Supervisory
Committee Member) Takayuki Hayakawa, and it deliberated on matters such as the selection of candidates for Directors(excluding Directors who are Audit & Supervisory Committee Members) and Executive Officers, as well as succession
plans.
2) The maximum amounts of total compensation for Directors (excluding Directors who are Audit & Supervisory Committee
Members) and Directors who are Audit & Supervisory Committee Members are determined by resolution of the General
Meeting of Shareholders.
When determining the compensation of each Director (excluding Directors who are Audit & Supervisory Committee
Members) and Executive Officer, the Board of Directors consults in advance with the Compensation Committee, a majorityof which is composed of Independent Outside Directors, and makes decisions with respect for the results of such reports.
In fiscal 2023, the Compensation Committee held three (3) meetings chaired by Outside Director (Audit & Supervisory
Committee Member) Shigeharu Nakamura, and it deliberated on matters such as individual compensation for Directors(excluding Directors who are Audit & Supervisory Committee Members) and Executive Officers (basic compensation,
performance-linked, and stock benefits).
The compensation of each Director who is an Audit & Supervisory Committee Member is determined by deliberation
among Audit & Supervisory Committee Members within the limit amount determined by resolution of the General Meetingof Shareholders.
Furthermore, policies for determining the content of compensation, etc. for individual Directors are described in “II. 1.
Organizational Composition and Operation [Director Remuneration] Disclosure of Policy on Determining Remuneration
Amounts and the Calculation Methods Thereof” of this report.
3) The attendance of each Committee member is provided in “Attendance of Individual Directors” at the end of this report.

3. Reasons for Adoption of Current Corporate Governance System

UpdatedTo strengthen the supervisory function of the Board of Directors, improve management transparency and fairness, and create a
flexible and strategic management system, the Company has adopted the format of a company with an audit and supervisorycommittee. The details are as follows.
1. Strengthening the Supervisory Function of the Board of Directors
The decision-making and supervisory function of management is separated from the business execution functions to clarify
where authority and responsibility lie, while the audit and supervisory functions of management are also strengthened bymeans of Directors who are Audit & Supervisory Committee Members holding voting rights at the Board of Directors
meetings.
2. Improving Management Transparency and Fairness
The Company has elected three (3) persons who have assured independence and externality as Outside Directors who are
Audit & Supervisory Committee Members, and strives to improve transparency and fairness in decision-making byimplementing audits and supervision, and advice from an independent third-party perspective on management.
3. Establishing a Flexible and Strategic Management System
The Company has adopted an Executive Officer System and promotes the considerable transfer of authority to execute
operations. By positioning the Management Committee as the main decision-making body for business execution, theCompany has taken steps to establish a flexible and strategic management system that can respond appropriately andpromptly to rapid changes in the business environment.

III. Implementation of Measures for Shareholders and Other Stakeholders
1.

Measures to Vitalize the General Shareholder Meetings and Facilitate Exercise of Voting
RightsUpdatedEarly Posting of Notice of the General
Shareholders Meeting

Scheduling of the General Shareholders
Meeting During Non-Peak Days
Electronic Exercise of Voting Rights
Participation in a Platform for the Electronic
Exercise of Voting Rights and Other Initiatives
to Enhance Environment for Institutional
Investors to Exercise Voting Rights
Provision of Notice (or Summary of Notice) of
the General Shareholders Meeting in English
Other

Supplementary Explanation
The convocation notice for the Ordinary General Meeting of Shareholders heldin June 2024 was sent two (2) days earlier than the statutory deadline.
Furthermore, the notice of convocation is posted on the Company’s website
and the electronic voting platform six (6) days prior to the date of dispatch of
the notice of convocation.
The Ordinary General Meeting of Shareholders held in June 2024 was held
four (4) business days earlier than the day when most General Meetings ofShareholders are concentrated.
Shareholders can exercise voting rights via the Internet.
The Company participates in the electronic voting platform for institutional
investors operated by ICJ, Inc.
The notice of convocation is translated into English and posted on the
Company’s website and the electronic voting platform.
The General Meeting of Shareholders is a corporate organ for decision-making
by shareholders, and the Company endeavors to ensure that legal andreasonable deliberations take place.

2. Status of IR-related Activities
Supplementary Explanation

Formulation and Publication of Disclosure
Policies

1. Basic Policy
The Company discloses information in accordancewith the Financial Instruments and Exchange Act, theCompanies Act, the “Rules on Timely Disclosure of
Corporate Information, etc., for Issuers of Listed
Securities” established by the Tokyo Stock
Exchange, etc. (the “Timely Disclosure Rules”). In
addition, the Company’s basic policy is to also
disclose information that does not fall under theTimely Disclosure Rules in a proactive and fairmanner using appropriate methods, as much as
possible, if it is deemed useful to stakeholders.
2. Method of Information Disclosure

Explanation by aRepresentative
Director

Regular Investor Briefings held for Analysts
and Institutional Investors

Online Disclosure of IR Information

Information that falls under the Timely Disclosure
Rules is disclosed using the Tokyo Stock Exchange's
Timely Disclosure Network (TDnet) in accordancewith the Rules, and the same information issubsequently posted on the Company’s website assoon as possible. In addition, the Company also takes
care to communicate information that does not fallunder the Timely Disclosure Rules to stakeholders inan accurate and fair manner using appropriate
methods, as soon as possible, taking into
consideration the intent of timely disclosure.
3. Quiet Period
The Company sets a “quiet period” from the day
after the last day of each quarter until each earnings
release date. During this period, it refrains fromcommenting on or answering questions related toearnings, in order to prevent leaks of information that
may affect the share price during the period whenearnings releases are being prepared. However, theCompany will disclose information as appropriate if
there is any expectation that business performance
will differ significantly from previously announced
forecasts during the quiet period.
4. Forward-Looking Statements
Please note that forward-looking information
disclosed by the Company in relation to forecasts ofbusiness performance, plans, strategies, etc., is basedon certain assumptions that the Company believes
are reasonable at the time of disclosure, and actual
performance may differ significantly from these
forecasts owing to various changes in theenvironment and other external factors.
Financial and Management Results Briefing for analysts
and institutional investors are held twice a year (at thetime of full-year earnings and interim earnings), in orderto deepen understanding of the Company’s businessperformance, plans, etc.
The Company discloses its “Blue Challenge Report(Integrated Report)” and materials of “Financial andManagement Results Briefing” and “Medium-TermBusiness Plan Briefing” for analysts and institutional
investors on its website.

Held

3. Status of Measures to Ensure Due Respect for Stakeholders
Establishment of Internal Rules Stipulating
Respect for the Position of Stakeholders
Implementation of Environmental Preservation
Activities and CSR Activities, etc.

Other

Supplementary Explanation
The Company has established these in the “RIKEN TECHNOS GROUP Codeof Conduct” and the “RIKEN TECHNOS GROUP Corporate Governance
Policy,” and it publishes these on its website.
In order to strive to establish the Company as an enterprise that contributes tothe realization of a prosperous society and responds to the trust of all its
stakeholders through environmentally-conscious corporate activities, theCompany has established basic management policies related to theenvironment, and the entire company has acquired ISO 14001 certification andis working together to implement environmental activities.
The Company considers and acts with stakeholders to achieve a sustainable
society, and discloses its efforts and results in the “Blue Challenge Report(Integrated Report).”<Establishment of Human Rights Policy>
The Group has established the “RIKEN TECHNOS GROUP Human Rights
Policy” as a guideline for efforts to respect human rights in order to realize asustainable society through the implementation of the management philosophy“RIKEN TECHNOS WAY” and the “RIKEN TECHNOS GROUP Code of
Conduct”.

IV. Matters Concerning the Internal Control System
1. Basic Views on Internal Control System and Status of Development
The Company and its subsidiaries (hereinafter, referred to as the “RIKEN TECHNOS GROUP”) have declared that they will
implement and comply with the “RIKEN TECHNOS WAY” and the “RIKEN TECHNOS GROUP Code of Conduct”(hereinafter, referred to as the “Code of Conduct”) as they conduct their corporate activities. The RIKEN TECHNOS GROUP
believes that the Internal Control System, a system established to ensure appropriate and efficient business operations, is anecessary and essential measure for the more reliable fulfillment of the abovementioned business practices.
The RIKEN TECHNOS GROUP hereby develops the following as its Internal Control System in accordance with the Companies
Act of Japan and the Ordinance for Enforcement of the Companies Act of Japan.
1. Systems to ensure that Directors' and employees' duties are performed in compliance with laws and regulations and the
Articles of Incorporation
1) All of the Directors, including the Representative Directors, make it thoroughly known to all of the executive andemployees that they are to put top priority on observing the “Code of Conduct” and ensuring that they perform their duties
in compliance with laws and regulations and the Articles of Incorporation.
2) The activities of the Risk & Compliance Committee are reported to the Board of Directors in a relevant and timely manner.
The General Affairs & Legal Department provides compliance training for all executives and employees.
3) In order to ensure that all executives and employees may directly report any suspicious activities contrary to laws andregulations, the Articles of Incorporation, the “Code of Conduct,” various guidelines, or other standards with which groupcompanies, Directors, and employees are to comply (hereinafter referred to as “Laws and Regulations”), the RIKENTECHNOS GROUP has established contact points for anonymous reporting in the Audit Department and in a consultative
law firm.
4) The RIKEN TECHNOS GROUP shall never have any relationships with antisocial powers or organizations that threaten the
security and order of civil society.
In addition, the RIKEN TECHNOS GROUP shall show fortitude and adamantly refuse any unreasonable demands byantisocial powers or organizations.
2. System for the preservation and management of information in relation to the performance of Directors' duties
Information in relation to the performance of Directors’ duties is controlled and managed in accordance with the “Rule forInformation Management” and is preserved in documents and electronic media.
The preserved information is made available for viewing in accordance with the “Rule for Information Management.”
3. Rules and systems for managing the risk of loss
Each department manages individual risk factors in relation to each department. The RIKEN TECHNOS GROUP has
established a Risk & Compliance Committee for company-wide, cross-cutting management of risk factors, and the Presidentof the Company serves as the chairperson of the Committee.
4. Systems to ensure that the Directors’ duties are performed efficiently
1) The Board of Directors formulates a Medium-Term Business Plan and the annual Business Plans.
2) The Board of Directors grasps the progress of the Business Plan by inspecting monthly record data on businessperformance with the help of information technology, and discusses and implements measures necessary for theachievement of the Business Plan.
3) The Management Meetings is held monthly in order to operate its business rapidly through active delegation of authority.
The progress of business achievement is checked by the Manufacturing Division and the Quality Assurance Division
through their Manufacturing and Quality-Related Division Meetings held on a quarterly basis; by the Technical Division
through their Technical Division Meetings held on a quarterly basis; by the Sales & Marketing Division through their
Sales & Marketing Division Meetings held on a quarterly basis; by the Procurement Division through their Procurement
Division Meetings held on a quarterly basis; and by other divisions through meetings held monthly at each division.
Appropriate countermeasures are taken if considered necessary.
5. Systems to ensure the appropriateness of the business operations of the RIKEN TECHNOS GROUP
1) The Corporate Planning Division, as the division with jurisdiction over overall business management of the Company’s
consolidated subsidiaries, is responsible for overseeing that each consolidated subsidiary of the Company is instructed toestablish its own Internal Control System and ensuring that each consolidated subsidiary share information of the same
quality and quantity in the same manner as the Company.
The Corporate Planning Division and each division manage the progress of their respective business operations, andmanage and supervise the Company’s consolidated subsidiaries with a view to ensuring that all reporting to the Company
and approval procedures at the Company shall be conducted appropriately, in accordance with the “Regulations on theManagement of RIKEN TECHNOS GROUP Consolidated Subsidiaries.” The Corporate Planning Division and the otherdivisions manage the risk of loss through such administration and supervision.
The Corporate Planning Division also arranges an operational report meeting attended by the President, Executive
Officers in charge, and the Senior General Manager of the Administrative Division, at least twice a year for domestic
consolidated subsidiaries and at least once a year for overseas consolidated subsidiaries.
On receipt of the monthly reports (including financial data) from each consolidated subsidiary of the Company, theCorporate Planning Division compiles them and then distributes the reports to the Directors, Executive Officers andrelevant departments.
2) The General Affairs & Legal Department has the executives and employees of RIKEN TECHNOS GROUP thoroughly
understand and observe the “RIKEN TECHNOS GROUP Compliance Manual,” and thereby strives to develop acompliance system for the RIKEN TECHNOS GROUP and settle issues facing the RIKEN TECHNOS GROUP.
3) The Audit Department regularly conducts operational audits at the RIKEN TECHNOS GROUP, and thereby confirms that
all operational activities comply with Laws and Regulations and checks and evaluates whether all operational activities
are efficiently operated in accordance with various managerial rules and whether the various managerial rules arefunctioning appropriately towards the achievement of the managerial targets.
6. Provisions on Directors and employees who assist the Audit & Supervisory Committee in performing its duties, on the
independence of such Directors and employees from other Directors (excluding Directors serving as Audit & Supervisory
Committee Members), and on measures to ensure the effectiveness of instructions of the Audit & Supervisory Committee tosuch Directors and employees
The Audit Department is set up as an organization under the direct control of the Audit & Supervisory Committee to assist the
Audit & Supervisory Committee in performing its duties, and several dedicated employees are appointed to the Audit
Department.
To ensure the independence of these employees, all rights to command and order them shall be delegated exclusively to the
Audit & Supervisory Committee, and these employees shall not be commanded or ordered by departments conducting
business operations or any of the Directors (excluding Directors serving as Audit & Supervisory Committee Members). In
addition, any decision on a personnel transfer, personnel evaluation, or disciplinary measures, etc. for these employees shallbe made subsequent to the approval from the Audit & Supervisory Committee.
The Company appoints no Director to assist the Audit & Supervisory Committee in performing its duties.
7. System for reporting to the Company’s Audit & Supervisory Committee by Directors (excluding Directors serving as Audit &Supervisory Committee Members), Executive Officers and employees of the Company, or by Directors, Corporate Auditors,
and employees of the Company’s subsidiaries, or by persons who have received reports from such Directors, Corporate
Auditors, and employees, and system for other forms of reporting to the Audit & Supervisory Committee
1) The Audit & Supervisory Committee Members attend important meetings, such as the Board of Directors Meeting andManagement Committee.
2) Directors of the Company (excluding Directors serving as Audit & Supervisory Committee Members), Executive Officers
and employees inform the Audit & Supervisory Committee of legal matters, as well as the matters that may havesignificant impact on the RIKEN TECHNOS GROUP (including the relevant matters in cases where it is considered thatthe acts of Directors, Executive Officers, or employees could infringe Laws and Regulations or cause serious damage).
3) The Audit Department reports the progress of internal auditing to the Audit & Supervisory Committee, in principle, every
month.
4) If the Directors, Corporate Auditors, and employees of a consolidated subsidiary of the Company consider that the actionsof a consolidated subsidiary or a Director or employee of a consolidated subsidiary may infringe Laws and Regulations orcause serious damage, they shall report such matter in accordance with the “Regulations on the Management of RIKENTECHNOS GROUP Consolidated Subsidiaries” and immediately report such matter to the Company’s Audit &Supervisory Committee.
5) A person who reported to the Audit & Supervisory Committee shall not be treated disadvantageously in personnel affairs
or in any other way, as a consequence of such reporting.
8. Provisions concerning procedures for the advance payment or redemption of expenses arising from the performance of dutiesof the Audit & Supervisory Committee Members, and other policies for the handling of expenses or liabilities arising from theperformance of duties of the Audit & Supervisory Committee Members
Audit & Supervisory Committee Members may request the Company to make advance payments, redeem expenses, or settle
repayments of assumed liabilities, etc. arising from the execution of their duties, and the Company shall promptly respond tosuch requests.
9. Other systems to ensure that the audits by Audit & Supervisory Committee are executed effectively
1) The Company strengthens cooperation between the Audit & Supervisory Committee and the Audit Department
established under the direct control of the Audit & Supervisory Committee and conducts effective and organizational
audits by conducting joint audits in Japan and overseas if considered necessary.
2) The Representative Directors and Audit & Supervisory Committee Members exchange opinions at the Board of Directors
Meeting held monthly and promptly communicate opinions and information necessary to conduct effective audits.
3) Audit & Supervisory Committee, Accounting Auditors, and the Audit Department hold a joint meeting semi-annually forthe purpose of exchanging opinions.

2. Basic Views on Measures for Eliminating Anti-Social Forces and Status of Development

UpdatedIn the “RIKEN TECHNOS GROUP Basic Policy on Internal Control System,” the Company clearly states that the Company andits subsidiaries “shall never have any relationships with antisocial powers or organizations that threaten the security and order ofcivil society” and“shall show fortitude and adamantly refuse any unreasonable demands by antisocial powers or organizations.”In addition, the Company is a member of the “Tokyo Metropolitan Police Department Special Violence Countermeasures
Federation, Public Incorporated Association,” and regularly exchanges information with local police and member companies.
Furthermore, the Company also make known our stance of eliminating anti-social powers in the compliance training conducted
regularly for our employees.

V. Other
1. Adoption of Anti-Takeover Measures
Adoption of Anti-Takeover Measures

Not Adopted

Supplementary Explanation for Applicable Items
Not applicable.

2. Other Matters Concerning the Corporate Governance System

UpdatedThe Company’s corporate governance and timely disclosure systems are described at the end of this report.
END

Corporate Governance System Chart
The status of the Company's internal corporate governance system is as follows.

General Meeting of Shareholders
Appointment

Appointment

Nominating
Committee

Inquiry

Compensation
Committee

Inquiry

Audit & Supervisory
Committee

Board of Directors

Reply

Appointment

Cooperation

Directors(excluding Audit &Supervisory Committee
Members)

Directors

Auditing(Audit & Supervisory Committee Members)

Accountanting
Auditors

Reply

Auditing

Election

Audit Department

Cooperation

Auditing

Auditing

Representative Director,
President & CEO

Management Committee（Executive Officers）
Sustainability Committee

Risk & Compliance
Committee

Environment Committee

Product Safety
Committee

Start-up Office for
New Business
Development

Technical Division

Sales & Marketing
Division

Quality Assurance
Division

Manufacturing Division

Procurement Division

Administrative DivisionCorporate Planning
Division

Timely Disclosure System Chart
Sharing

Audit & Supervisory Committee

Board of Directors

Reporting anddeliberation

Resolution and approval of material
information

Representative Director
President & CEO
Reporting

ReportingApproval

Senior General Manager of
Administrative Division(Manager responsible for information
disclosure)

Reporting

Department in charge of disclosure

Reporting(General Affairs & Legal Department, Accounting
Department, Corporate Planning Department)• Compilation of various types of
information• Judgments concerning information
for timely disclosure• Preparation of timely disclosure

Instruction and communication

General Manager ofGeneral Affairs & Legal
Department

Reporting,
instruction, andcommunication

Disclosure of information

Tokyo
Stock
Exchange(Manager responsible for handlinginformation)

ReportingConfirmation of occurrence ofmaterial information

◎

1.

2.

Status of the Company's Internal System for the Timely Disclosure of Corporate Information< Explanation >Handling of various types of corporate information① Material information occurring in each department is immediately reported to the General Manager of
the General Affairs & Legal Department.
② The department in charge of disclosure confirms the information for timely disclosure by comparing all
material information reported by the General Manager of the General Affairs & Legal Department
against the “Timely Disclosure Rules.” In addition, information for timely disclosure is also confirmedin the same way in relation to matters approved by the Board of Directors, etc.
③ After confirming the information for timely disclosure, the department in charge of disclosure prepares atimely disclosure report, etc., after obtaining approval from the Senior General Manager of the
Administrative Division (the manager responsible for information disclosure). Timely disclosure reports,
etc., are reported to the Representative Director, President & CEO and the timely disclosure is promptly
performed after approval. Timely disclosure reports are also reported to the Audit Committee when
deemed necessary by the General Manager of Administration Division. However, if it takes time for the
Representative Director to approve the report, the timely disclosure may be made with the approval of
the Senior General Manager of Administrative Division.
④ Timely disclosure reports, etc. are also immediately reported to the Audit & Supervisory Committee
when deemed necessary by the Senior General Manager of Administrative Division.
Other・ The Company's internal system for the timely disclosure of corporate information and theappropriateness of its operation are verified as necessary and appropriate by third parties such as
attorneys and the Accounting Auditors.

[Skill Matrix of the Board of Directors (Japan’s Corporate Governance Code Supplementary Principle 4-11-1)]
In order to appropriately supervise the promotion of the four strategies set forth in the “Challenge Now for Change New
2024,” a management policy under our three-year Medium-term Business Plan, as well as the measures supporting thosestrategies, we have identified the skills expected of the Board of Directors as follows and formulated a skills matrix.
<Relationship between management strategies and skill items>
Strategies to Grow Strengths of Businesses
Four Strategies of theThree-year Mediumterm Business Plan

Skill Items

Strategy 1
Intensify global
management andgenerate synergies
Corporate
management/
Management
strategy

Strategies for Future Growth
Strategy 3
Take on thechallenge toward
new businesses
and products

Strategy 2
Stay ahead ofcustomers’
expectations

Sales/
Marketing

R&D/
Manufacturing

Strategy 4Contribute tosolvingenvironmental andsocial issues

Measures that Support the Four Strategies(Capital investments in manufacturing
facilities, Intellectual property and R&D
investments, DX investments, Human
capital investments, and Reinforcement ofgovernance structures)

ESG/
Sustainability

Global experience

Finance/
Accounting

Legal/
Risk management

Personnel/Labor/
Human resource
development

DX/IT<Skill possession status>
SkillsName

Position

Corporate
management/Man
agement strategy

KazuakiTokiwaRepresentative
Director, President
& CEO

〇

Personnel/
Sales/

GlobalR&D/

Finance/

Legal/Risk

Marketingexperience

Manufacturing

Accounting

management

Labor/ESG/

Human resource Sustainability

DX/ITdevelopment

〇

〇

〇

〇

･Experience as a president of a U.S. subsidiary ･Work experience in sales, corporate planning, and quality assurance divisions

Junji Irie

Representative
〇
〇
〇
〇
〇
〇
Director, Senior
Managing･ Experience as an executive officer at a bank ･ Experience as a senior general manager of the Company’s administrative
Executive Officer(personnel/accounting/legal/system)/corporate planning divisions

Gakuyuki
Kajiyama

Director, Managing
Executive Officer

〇

〇

〇

〇

〇

･ Experience as a president of a U.S. subsidiary ･ Experience as a senior general manager of corporate planning division ･ Work
experience in sales/R&D divisions

Director, Full-time
〇
〇
〇
〇
〇
Audit &
Supervisory･Experience as a president of a U.S./domestic subsidiary ･Experience as a senior general manager of manufacturing/quality assuranceCommittee Member
divisions ･Work experience in R&D/personnel divisions
Outside Director
Audit &〇〇〇〇〇
Supervisory
Shigeharu
Nakamura Committee Member(Primary/･Experience as a vice president/executive officer at a bank ･Work experience in international/corporate governance divisions
Independent)
Outside Director
Audit &〇〇〇〇〇
Shigeru Ehara Supervisory
Committee Member･Experience as a vice president/executive officer at a non-life insurance company ･Overseas work experience(Independent)
Outside Director
Audit &〇〇〇
Aogi Suemura Supervisory
Committee Member･Experience as a partner at an auditing firm ･Certified Public Accountant qualification(Independent)

TakashiShimada<Definition of Skills>
Skill Items
1

Definition
Experience as a director, executive officer, etc., at other companies (at a consolidated subsidiary,Corporate management/

experience as a president)

Management strategy

Work experience at a corporate planning division, etc.

2

Sales/Marketing

Experience as a sales rep in the chemical industry, work experience in marketing division, etc.

3

Global experience

Overseas work experience, work experience in international division, etc.

4

R&D/Manufacturing

Work experience in R&D/manufacturing, or similar divisions

5

Finance/Accounting

6

Legal/Risk management

7

Work experience in accounting/finance divisions, or financial institutions, etc.
Knowledge of finance/accounting
Work experience in legal/risk management, or similar divisions
Knowledge of legal/risk management

Personnel/Labor/

Work experience in personnel/labor/human resources development, or similar divisions

Human resource development

Knowledge of personnel/labor/human resources development

8

ESG/Sustainability

9

DX/IT

Work experience in ESG-related divisions
Knowledge of ESG/sustainability
Work experience in system development divisions, etc.
Knowledge of DX/IT[Attendance of Individual Directors]
Title

Name

Board of

Nomination

Compensation

Directors

Committee

Committee

Audit &
Supervisory
Committee

Representative Director
President & CEO

Kazuaki Tokiwa

16/16（100%）

2/3
（67%）

2/3
（67%）

−

Representative Director
Senior Managing Executive
Officer

Junji Irie

16/16
（100%）

3/3（100%）

3/3（100%）−

Director
Managing Executive Officer

Gakuyuki Kajiyama

16/16（100%）−−−

Director(Full-time Audit &Supervisory Committee
Member)Takashi Shimada

−

−

−

−

Shigeharu Nakamura

16/16（100%）

3/3（100%）

3/3（100%）

18/18（100%）

Shigeru Ehara

16/16（100%）

3/3（100%）

3/3（100%）

18/18（100%）

Aogi Suemura

16/16（100%）

3/3（100%）

3/3（100%）

18/18（100%）

Director(Audit & Supervisory
Committee Member)
Director(Audit & Supervisory
Committee Member)
Director(Audit & Supervisory
Committee Member)[Approaches and Initiatives on Sustainability]
Recognizing that responding to issues surrounding sustainability is one of our key management challenges, the Group seeks to help
realize a sustainable society and enhance its enterprise value under “Contributing to solving environmental and social issues” as a priority
strategy in the Medium-Term Business Plan.

(1) GovernanceIn light of dramatic changes in the environment surrounding the Group, we have established the Sustainability Committee as afunction linking the frontlines and management in order to further incorporate the expectations of stakeholders into our corporate
activities. Chaired by the President & CEO, the Sustainability Committee comprises all executive officers who are members of theManagement Committee, with outside directors participating as observers. Led by senior management, we have established anorganizational structure that enables expedited management decision-making and implementation of measures.
The Sustainability Committee deliberates on various important issues related to sustainability and reports their deliberations andfindings to the Management Committee. In addition, deliberations on climate-related issues by the Management Committee areregularly reported to the Board of Directors.
In fiscal 2023, the Sustainability Committee met six (6) times, and the Board of Directors made deliberations three (3) times.
We have also established the Risk & Compliance Committee as a function to centrally manage risks within the Group including
sustainability. The Risk & Compliance Committee is chaired by the President & CEO and consists of all Executive Officers who aremembers of the Management Committee, with Outside Directors participating as observers.
The Sustainability Committee and its subordinate organization, the Environment Committee, deliberate on various material issues(materialities) including climate change, and report their deliberations and findings to the Management Committee. In addition,
climate-related matters discussed by the Management Committee are regularly reported to the Board of Directors.
In the fiscal year ended March 31, 2024, the Sustainability Committee defined key performance indicators (KPI) for nine of thematerial issues (materialities) identified the previous fiscal year as being of particular importance to the Group, and the Board of
Directors resolved them. Initiatives for achieving the KPIs were implemented, and the progress of these initiatives was reported to
the Board of Directors on a quarterly basis. By managing this progress, the Group is repeating the PDCA cycle and working torealize its long-term vision.
(Sustainability promotion structure chart)(2) Strategy
The Group defined the following items as materialities at the Board of Directors meeting held in March 2023, and set KPIs for nine
items among them that the Group considers of particular importance to promote initiatives.

The progress of materialities is managed by the Sustainability Committee.

[Response to climate change (Contribute to a sustainable global environment)]
The Group has performed scenario analyses for the years 2030 and 2050 in the context of climate change based on two world views:
a 1.5

and 4

rise in global temperatures by 2100. In our analysis, we refer to the scenarios disclosed by the government bodies

and research institutes listed in the table below:

World View

Scenarios used in the analysis
World Energy Outlook (WEO), IEA, 2023

1.5

Net Zero Emissions by 2050（NZE）
Shared Socio-economic Pathway (SSP1-1.9), IPCC, 2021

4Stated Policy Scenario (STEPS), IEA, 2020
Representative Concentration Pathways (RCP6.0, 8.5), IPCC, 2014

The Sustainability Committee deliberates on how social responses to climate-related issues and problems could affect the Groupand its entire supply chain, and identifies climate-related risks and opportunities.

<Risks>
The scenario analysis revealed that the Group's performance may be affected by the introduction of policy measures to combat climatechange, such as a carbon tax, or by delays in the development of or other action concerning environmentally friendly products.
Risk type

Risk overview

Financial
impact1.5

Transition
risk

Policies Increased carbon taxes raise the cost ofandprocuring key raw materials and Medium Small
regulations energy.

The introduction of a carbon tax resultsin the substitution of conventional raw
Policies materials for low-carbon raw materials,
Transition
andwhich generates or increases costs
risk
regulations associated with the development andprocurement costs of substitute raw
materials.

Large

―

Delay in developing environmentallyfriendly products; our customers
replace our products with low-carbon
Transition
Technology
Mediumproducts from competitors, reducing
risk
demand for and sales of our products
and services.

―

Transition
Marketsrisk

Prices of petrochemical feedstocks
soar, raising the cost of procuring raw
materials.

Transition
Markets
risk

Delay in responding to our customers’
reduced needs for petroleum-derived
raw materials and rising needs for nonpetroleum-derived raw materials, Medium
shifting demand away from our
products/services and decreasing oursales.

Small

Countermeasures

4

Large

―

• Execute medium-term business plan strategy of“contributing to solving environmental and social
issues.”• Adopt use of electricity derived from renewableenergy sources.
• Switch from heavy oil to natural gas.
• Monitor GHG emission intensities of raw materials,
and switch to low-carbon raw materials.
• Improve energy efficiency of production facilities.
• Execute medium-term business plan strategies of“taking on the challenge toward new businesses andproducts” and “contributing to solving environmental
and social issues.”• Consolidate raw materials (substitute raw materials
with high procurement risk).
• Switch raw materials used to low-carbon raw
materials.
• Make multiple-source purchasing.
• Execute medium-term business plan strategies of“taking on the challenge toward new businesses andproducts” and “contributing to solving environmental
and social issues.”• Increase allocation of management resources todevelopment of environmentally friendly products. *1• Execute medium-term business plan strategies of“taking on the challenge toward new businesses andproducts” and “contributing to solving environmental
and social issues.”• Develop and sell RIKEBIO® series.
• Proactively adopt and accelerate the transition tobiomass feedstocks and promote their use.
• Execute medium-term business plan strategy of“staying ahead of customer’ expectations.”• Develop products that meet the needs of customers
forhigherfunctionality(volumereduction/miniaturization).
• Develop and sell RIKEBIO® series.

• Execute medium-term business plan strategy of“contributing to solving environmental and social
issues.”Delayed action on the environment• Have each committee conduct monitoring to prevent
causes a drop in our stock price due toTransition
delays in environmental action and damage to our
Reputation
Medium ―a decline in investors' assessment ofrisk
reputation.
our environmental performance.
• Proactively disclose information about ourenvironmentallyfriendly
products*1
andenvironmental action to stakeholders.
• Execute medium-term business plan strategy of
The Company and its supply chain are“intensifying global management and generating
struck by a disaster; until operations aresynergies.”
Physicalrestored, sales decrease due to theAcuteMediumMedium • Pursue global manufacturing and order management.
risksuspension or reduction of business• Strengthen BCP structure to encompass global sites
activities, while costs associated withand improve alternative production and supply
restoration and amelioration rise.
structures.
The cost of countermeasures for ourbuildings located near oceans and• Execute medium-term business plan strategy ofrivers will increase due to the increased“contributing to solving environmental and social
Physical
Chronic occurrence of flooding caused by Small Medium issues.”
risk
overflowing rivers and rising sea levels• Perform proper assessments of disaster risk and takeattributable to extreme fluctuations inproactive countermeasures.
rainfall and weather pattern.
*1

Circular economy compatible products, including RIKEBIO®. RIKEBIO® = Products made from biomass feedstocks

<Opportunities>
The scenario analysis revealed the Group’s performance may be affected by the development of products that contribute to energy
conservation and the provision of low-carbon type products and materials with added functions.
Opportunity
type

Financial
1.5

Development of products that contributeto energy conservation in the market andEnergy sources the uptake of renewable energy
generation technologies and equipment
increase sales of our related products.

Products
services

Reputation

Resilience

impactOpportunity overview

Small

4

―

• Execute medium-term business plan strategies of“staying ahead of customer’ expectations” and“contributing to solving environmental and social
issues.”• Expand sales of climate change-responsive
products*2 tailored to customer needs.

Demand for and sales of our products
increase due to the development and saleof materials with additional functions
and and products with fewer petroleum- Medium
derived components (low-carbon typeproducts) in response to increased
demand for low-carbon type products.
Proactive efforts to address climatechange earn the trust of stakeholders and Medium
enhance our enterprise value.
The global expansion of our businesssites improves our resilience by
providing a stable supply of products toour customers even in an environment of
increasing natural disasters, forestalling
sales declines and building customer
trust, leading in turn to higher sales.

Measures

Small―• Execute medium-term business plan strategies of“staying ahead of customer’ expectations” and“contributing to solving environmental and social
issues.”• Promote recycling of our products.
• Develop environmentally friendly products. *1• Develop and sell RIKEBIO® series products.

―• Execute medium-term business plan strategy of“contributing to solving environmental and social
issues.”• Enhance disclosure regarding our action on theenvironment.

Small• Execute medium-term business plan strategy of“intensifying global management and generatesynergies.”• Leverage our global sites to further strengthen our
raw materials procurement capabilities and BCP
structure.

*1 Circular economy compatible products, including RIKEBIO®. RIKEBIO® = Products made from biomass feedstocks*2 Products for which the functions of the materials contribute to energy conservation

[Policies and strategies for human resource development and internal environment development(“Nurture appropriate human resources for a challenger”)]
We consider it to be the most important to secure and nurture personnel who are required to execute the three strategies
among the four under the Group’s three-year Medium-term Business Plan, and are implementing various initiatives.
Strategies in the Medium-term Business Plan

Personnel required for executing strategies

Intensifying global management and generate synergies

Personnel capable of implementing global businessstrategies

Staying ahead of customers’ expectations
Taking on the challenge toward new businesses and products

Personnel with analytical ability and strategic perspective
Personnel with diverse points of view

• Human Resource Development Policy
Employees and the Company have a relationship of mutual growth, and “the employee’s growth means the company’s
growth.”Our policy for human resource development aims for a state in which 1) each employee implements the “RIKEN TECHNOS
WAY” and grows into human resource that the Company expects them to be; and 2) the Company achieves growthsimultaneously by uniting abilities possessed by each individual and exerting it as an organizational capability.
The Company will support the growth and success of employees by providing places for optimal work and environments where
each and every employee can demonstrate the abilities required by the Company, and actively developing (investing in) humanresources who can win amid global competition. By bringing together the enhanced abilities of individual employees throughdialogue and demonstrating the collective strength of the team, we will further develop the Company.
If the Company lacks any knowledge, insight, ability, or career that cannot be supplemented by training alone, we will complement
it with mid-career hires and other means for revitalization and growth of the Company.
Under the belief that it is always fundamental for each and every employee to voluntarily practice the management philosophy“RIKEN TECHNOS WAY,” the Company is responsible for creating an environment for that purpose.
• Internal Environment Development Policy
To become a globally competitive company, the policy for internal environment development of the Company is to establish
systems and foster a culture so that employees with diverse individualities can play active roles at work.
The Company will realize diverse ways of working by creating schemes and an environment where diverse human resources feel
comfortable in maintaining their individuality and work to their fullest potential freely and energetically.

(3) Risk management
For risk management, our basic policy is to practice “RIKEN TECHNOS WAY,” comply with the Code of Conduct, ensure thesoundness of management, ensure stable business continuity, prioritize human life, instill the spirit of compliance, and eliminate or
mitigate factors that hinder stakeholder interests.
The Risk & Compliance Committee identified and evaluated risks for the entire Group, and has worked to respond to risks mainly
including challenges that have been identified as those requiring a priority response.
Each department manages individual risk factors in relation to each department. The Risk & Compliance Committee centrally andintegrally manages risks surrounding the Group including consolidated subsidiaries. In addition, in April 2024, the Risk &Compliance Committee also began human rights due diligence (i.e., identifying human rights risks and implementing measures toaddress them).

[Response to climate change (Contribute to a sustainable global environment)]
With regard to climate change-related risks, the Sustainability Committee and the Risk & Compliance Committee play central roles
in formulating policies and developing countermeasures to avoid, mitigate, and control risks, which are then approved by the Boardof Directors for Group-wide risk management. They also monitor the status of the implementation and effectiveness of thecountermeasures.

(4) Indicators and targets
Materialities and KPIs
Materiality topic

Contribute to a sustainable global
environment

Promote health management andoccupational health and safety

Develop human resources suited toa “challenger”
Improve quality
product safety

andensuring

Create new businesses and new
products
Improve production technologies
and efficiency
Business transformation throughDX

Respect for human rights

Dialogue with stakeholders

Standards for evaluation (KPIs)

Mid-to long-term targets
FY2024FY203024,139t

35,446t(46.2% decrease
compared to FY2019)――・ Ratio of total waste to total production(non-consolidated)

3.3% or less

3.0% or less・Occupational injuries requiring time offwork (domestic)00・ Percentage of employees undergoing
specified health examinations (domestic)

90%

90%

・ Percentage of employees provided
specified health guidance (domestic)

55%

60%

・ Training cost per employee (nonconsolidated)

117,000 yen

140,000 yen

・Serious quality incidents requiring recalls(non-consolidated)

00・Serious violations of legal and regulatorycompliance regarding use of chemical
substances (non-consolidated)

00・ Numbers of patents applications (nonconsolidated)

45 (cumulative)

210 (cumulative)(FY2022-2024)(FY2022-2030)

・Numbers of collaborations with external
parties (non-consolidated)

10 (cumulative)

35 (cumulative)(FY2022-2024)(FY2022-2030)

・Production capacity (non-consolidated)+10% (vs. FY2021)+33% (vs. FY2021)

・ Development of MI human resources(non-consolidated)

9 persons

20 persons

・ DX training for all employees (nonconsolidated)

100% attendance

100% attendance・Human rights and compliance training for
all employees (domestic)

100% attendance

100% attendance・Conduct ESG survey to suppliers (nonconsolidated)

Once/year

Once/year

・ Meetings with investors and existing
shareholders (non-consolidated)

140 or morecompanies/year

200 or morecompanies/year

・Conduct satisfaction survey to customers
and suppliers (non-consolidated)

Once/year

Once/year

・ Achieving CO2 emissions reduction
targetsfor2030(non-consolidated)
・Carbon neutral by 2050 (Group)

[Response to climate change (Contribute to a sustainable global environment)]
Greenhouse gas emissions may pose a risk for the Group's overall financial condition, but by developing products acceptable to a
decarbonized society, this situation can also lead to business opportunities. In addition to setting medium- to long-term emissions
reduction targets for the Group as a whole, we are planning specific initiatives to cut CO emissions and have determined
indicators to manage the progress of these initiatives.
RIKEN TECHNOS GROUP’s CO2 emissions in fiscal 2023 (Scope 1, 2 and 3)
Scope 1 and 2 emissions: 40,859 tons from the Company (non-consolidated), 86,520 tons from the Group (the Company, nonconsolidated + affiliates)
Scope 3 emissions: 1,212,634 tons from the Group**Category 4 and Category 9 are calculated based on the activities of the Company (non-consolidated)

RIKEN TECHNOS GROUP’s medium- to long-term CO2 emission reduction targets
The Company’s Non-consolidated targets for 2030 (Scope 1 and 2)
24,139 tons (46.2% decrease from FY2019) *(FY2019 baseline: 44,868 tons)
We are seeking to achieve carbon neutrality for the entire Group by 2050.