Corporate Governance Report
CORPORATE GOVERNANCE

Sanken Electric Co., Ltd.

Last Update:June 28, 2024

Sanken Electric Co., Ltd.
Hiroshi Takahashi, President and Representative Director
Contact: 81-48-472-1111
Securities code: 6707
https://www.sanken-ele.co.jp
The corporate governance of Sanken Electric Co., Ltd. (the “Company”) is described below.

I. Basic Views on Corporate Governance, Capital Structure, Corporate Attributes, and OtherKey Information
1. Basic Views
In order to contribute to society through power electronics and achieve the enhancement of its corporate value, the Company
positions corporate governance as one of its material management issues and continues to strive to enhance its corporate
governance system and functions. The Company views corporate governance at the Company as a system to enable it to takedemands from a wide range of stakeholders into consideration and take timely and appropriate actions in global businesses thatit engages in, which have grown more diversified and more complex, and to make speedy and bold decisions while securingtransparency and fairness in the process. The Company will implement measures necessary to achieve these objectives, ensureaccountability for those measures, and actively engage in dialogues with a wide range of stakeholders to further improve its
corporate governance.

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

Disclosure Based on each Principle of the Corporate Governance Code Updated[Principle 1-4 Cross-Shareholdings]- Policy regarding cross-shareholdings
The Company may hold shares in business partners and other companies in order to maintain and strengthen business relations
with them and increase the Company’s medium- to long-term corporate value, and when investing in those shares, theCompany determines whether the investment is justifiable by comprehensively taking account of the profit expected to beearned by strengthening the business relations, the amount of investment, and other factors. For each of those crossshareholdings, the Board of Directors examines each year whether it is rational to continue to hold those shares from themedium- to long-term perspective by comprehensively taking account of the benefit expected to be gained by maintaining andstrengthening the business relations and other factors. The Company reduces its holding of those shares when it determines it is
not rational to hold them as cross-shareholdings.
- Criteria for exercising voting rights
The Company appropriately exercises voting rights attached to the cross-shareholdings after comprehensively judging whether
the Company should vote for or against a given proposal by taking account of whether it will contribute to the enhancement ofa proper corporate governance system or increase in shareholder value, or there will be any effect on the Company. The
Company also discusses the content of proposals and other issues with the issuers of the cross-shareholdings as needed.
[Principle 1-7 Related Party Transactions]
The Company’s Regulations of the Board of Directors stipulates that when the Company directly transacts with any of its
officers, the Company should explain the content, etc., of the transaction to obtain approval from the Board of Directors andthat even if the transaction is approved by the Board of Directors, the Company should thereafter report on the status, etc., of
the transaction to the Board of Directors.

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[Supplementary Principle 2-4-1 Policies, Goals, etc., for Ensuring Diversity]
The Company promotes the recruitment of human resources with diverse backgrounds, regardless of nationality, gender, orother attributes. The Company seeks to strengthen its human resource base to lay the foundation for organizationaltransformation, by not only empowering women, but also leveraging the expertise of senior employees and taking othermeasures.
As part of its human resource development initiatives to increase female managers, the Company offers education and training
programs for selected female employees jointly with its group companies in Japan, with the aim of becoming a company wherefemale employees can be active. The percentage of female managers, which the Company has made one of its long-term
consolidated key performance indicators (KPIs) with a target of 11% for fiscal 2025, currently stands at 5.9%. As forrecruitment of non-Japanese employees and mid-career recruits, the Company has not set specific percentage targets but has
implemented the following measures to increase the diversity of its human resources. As for recruitment of non-Japaneseemployees, the Company has focused on the employment of international students studying in Japan and overseas local
workers, and has provided them with thorough education and training, taking into consideration the differences between Japanand other countries in attitudes to work, career development, and other aspects, with a view of making them candidates for core
employees who may serve as managers in the future. The Company will continue to advance these initiatives. As for mid-career
recruits, the Company has worked to develop a workplace environment where they can get rapidly on board and be effective
immediately. As a result, mid-career recruits now account for about 30% of the managers at the Company. The Company willcontinue to advance this effort.
[Principle 2-6 Roles of Corporate Pension Funds as Asset Owners]
The management of the Company’s corporate pension funds is overseen by the Pension Fund Management Committee, which
consists of committee members elected by the Company from those engaged in accounting and other related functions andcommittee members elected from employees. The Pension Fund Management Committee has developed a system whereby the
corporate pension funds are managed in accordance with the strategic asset mix determined to achieve targets. The Committee
oversees the status of pension fund management by monitoring, as needed, entrusted asset management firms. If a significant
deviation from targets is expected, the Committee holds a committee meeting as needed and takes appropriate measures such as
conducting a review. With the Committee structured and operated in this way, the Company has developed a system to properly
manage and oversee conflicts of interest between the Company and the beneficiaries of its corporate pension. In addition, inorder to enhance expertise in corporate pension fund management and to duly perform the function of monitoring the entrusted
asset management firms, the Company assigns and appoints staff with appropriate qualifications, while also providing themwith educational opportunities.
[Principle 3-1 Full Disclosure](i) Management philosophy, management strategy, and management plan
Please see the Company’s management philosophy and corporate vision and “Section 2. Overview of Business: 1. Management
Policy, Business Environment, Issues to Address” in the Company’s Annual Securities Report for the 107th fiscal year postedon the Company’s website:
https://www.sanken-ele.co.jp
https://www.sanken-ele.co.jp/corp/tousika/houkoku_yuuka.htm(ii) Basic views and basic policy on corporate governance
Please see “Section 4. Information about Reporting Company: 4. Corporate Governance” in the Company’s Annual Securities
Report for the 107th fiscal year posted on the Company’s website:
https://www.sanken-ele.co.jp/corp/tousika/houkoku_yuuka.htm(iii) Policies and procedures for determining compensation for officers
Basic concept for the compensation plan for officers
The Company considers its compensation plan for officers (compensation plan for executive officers) as an important corporate
governance matter and has adopted a basic concept for the compensation plan as follows.
- Contributing to the procurement of excellent human resources- Setting levels of compensation appropriate for the role and scope of responsibility for each rank
- Providing incentives toward the increased corporate value and sustainable growth of the Company- Ensuring transparency and objectivity in the procedure for determining compensation
For other details, please see “Section 4. Information about Reporting Company: 4. Corporate Governance (4) Compensation for
Officers” in the Company’s Annual Securities Report for the 107th fiscal year posted on the Company’s website:
https://www.sanken-ele.co.jp/corp/tousika/houkoku_yuuka.htm

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(iv) Policies and procedures for electing and nominating officers, etc.
The Company considers that the Board of Directors needs to have as its members a certain number of persons who are wellversed in the Company’ business and its issues in order to fulfill its roles and duties effectively. In addition, in order to ensure
the independence and objectivity of the Board of Directors, the Company considers that it is important to secure not only the
independence as the Board of Directors, through such measures as electing independent External Directors so that they
constitute the majority, but also the diversity of the Board of Directors in terms of, among others, gender, knowledge,
experience, and ability. In light of these considerations, the Company nominates as candidates for its executive Directors
persons who are well versed in the Company’s business and its issues, etc., while also nominating as candidates for its External
Directors persons who are independent, have diverse knowledge and background, are able to contribute to ensuring
appropriateness in business execution from an independent standpoint, and are expected to provide advice, etc., that help
increase the Company’s corporate value, so that the Company can set its strategic direction properly. The Company nominates
as candidates for its Directors who are Audit and Supervisory Committee Members persons who have the ability, experience,and expertise necessary for the audit and supervision of the Company and are able to contribute to securing soundness in the
Company’s corporate management. The Company elects as its Corporate Officers persons who are outstanding as demonstrated
in their assessment in terms of ability to execute duties, character, qualifications as management members, etc. In addition, if it
is found that any of the causes for disqualification stipulated in the Regulations of Corporate Officers applies to a Corporate
Officer or a Corporate Officer has committed any of the acts prohibited under the Regulations of Corporate Officers, the Boardof Directors deliberates and decides on dismissal of or other disciplinary measures for the Corporate Officer.
Based on the above polices, a proposal on candidates for Directors and Corporate Officers is submitted to the voluntary
Nomination Committee, the majority of which consists of independent External Directors, for deliberation. After the
deliberation by the Nomination Committee, the Board of Directors determines candidates for Directors and Corporate Officers,
paying due respect to the advice and report of the Nomination Committee. The Board of Directors determines candidates for
Directors who are Audit and Supervisory Committee Members, after obtaining the consent of the Audit and Supervisory
Committee.
(v) Reasons for election and nomination of candidates for Directors (and reasons for dismissal of Directors when it occurs) aredescribed and disclosed in the notice of convocation of the General Meeting of Shareholders.
[Supplementary Principle 3-1-3 Sustainability Initiatives, etc.]
As its sustainability initiatives, the Group has incorporated the Sustainable Development Goals (SDGs) into its management
since 2020, making “reduction of CO2 emissions through our businesses (energy conservation and enhancement of efficiency)”
and “mitigation of environmental impact through our business activities” the Company’s material issues, and has been taking
measures to address these issues. In addition, as part of its efforts to support these activities, the Company has worked todevelop secure and safe workplaces, promote flexible workstyles, and enhance employees’ health, with the aim of achieving
the objective of “value creation in a good working environment.” In order to spur these sustainability initiatives, the Company
established the Sustainability Committee in October 2021 and is working to develop a system for advancing the initiatives,
while also setting measures and defining performance indicators for ESG management.
The Group Basic CSR Policy sets out that one of the Group’s aims is to contribute to the development of the international
community by developing, producing, and selling energy-saving, highly efficient products for power electronics and peripheral
areas in the core semiconductor business. The Company considers that addressing climate change is a material issue forachieving a sustainable social environment, and takes action and discloses information in line with the Task Force on Climaterelated Financial Disclosures (TCFD) Recommendations, which are widely adopted in sustainability disclosures in Japan andabroad.
For details, please see “Section 2. Views on and Initiatives for Sustainability” in the Company’s Annual Securities Report forthe 107th fiscal year:
https://www.sanken-ele.co.jp/corp/tousika/houkoku_yuuka.htm
The Company considers intellectual property a management resource necessary for achieving sustainable growth of acorporation. The Company proactively applies for patents and strives to acquire patent rights with respect to its technologies
that are important from the perspective of business strategy and product development strategy, by utilizing the system, etc., tocreate intellectual property, such as the patent promotion leader program for exploring inventions. The Company holds patents
in and outside Japan, primarily in Japan, the US, and China, which are or will be the Company’s major markets. The Company
keeps its technological know-how in strict confidence and ensures that its key technologies such as production processes will
not be leaked outside of the Company through business collaborations with other companies, etc. In addition, the Company has
developed a system to examine other companies’ intellectual property rights in order to prevent infringement of othercompanies’ intellectual property rights as the Company works on product development.

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[Supplementary Principle 4-1-1 Outline of the Scope of Delegation from the Board of Directors to the Management]
Matters on material business execution, etc., that should be resolved by the Board of Directors are deliberated on anddetermined by the Board of Directors in accordance with the Regulations of the Board of Directors. Delegation of operations to
Corporate Officers is determined after deliberation by the Board of Directors, and the scope of delegation and the
responsibilities and authorities are clearly stipulated in the regulations on organizational authorities and division of duties.
[Principle 4-8 Effective Use of Independent External Directors]
Based on the basic views on corporate governance as stated above, the Company has elected seven independent External
Directors (including two External Directors who are Audit and Supervisory Committee Members) so that independent External
Directors constitute the majority in the Board of Directors. The Company considers that this helps ensure an objective andneutral management supervisory function of the Board of Directors. Going forward, the Company will continue to explore an
appropriate corporate governance system for the Company, considering demands from stakeholders and social demands
regarding corporate governance, etc., comprehensively.
[Principle 4-9 Criteria for Determining the Independence of Independent External Directors and Their Qualifications]
The Company has set criteria for electing candidates for independent External Directors as follows; the candidate should be a
person who is unlikely to have a conflict of interest with general shareholders and who is expected to contribute to the Board of
Directors. These criteria are based on the independence standards set by the Tokyo Stock Exchange, which require the listedcompany to determine, among others, whether there is a business relation with the candidate and whether the business relation,
if any, is material.
[Supplementary Principle 4-10-1 Nomination Committee and Compensation Committee]
The Company has established the Nomination Committee and the Compensation Committee as voluntary advisory bodies for
the Board of Directors to improve adequacy and transparency regarding the nomination of Directors and compensation for
Directors. The composition, etc. of the Nomination Committee and the Compensation Committee for the fiscal year ended
March 31, 2024 are as follows:[Nomination Committee]
An External Director serves as Chairperson and External Directors constitute the majority of the membership.
Chairperson: Hideki Hirano (External Director)
Members: Noriharu Fujita (External Director), Takaki Yamada (External Director), and Hiroshi Takahashi (President andRepresentative Director)
Committee meeting: Held three times
In the Nomination Committee, External Directors constitute the majority and an External Director serves as Chairperson. With
the aim of enhancing the independence and objectivity of the function of the Board of Directors and its accountability regarding
the nomination of Representative Directors, Directors, Corporate Officers, etc., the Committee deliberates on candidates for the
successor of President and Representative Director and their development plans, the election of Directors and Corporate
Officers, etc., and reports on the results and provides advice to the Board of Directors. During the fiscal year ended March 31,
2024 the Committee mainly deliberated on what the Board of Directors should be and its direction, as well as the composition,etc. of the Board of Directors. The Committee also confirmed the requirements for candidates for the successor of President. In
addition, the Committee deliberated on the appropriateness of their development plans using a skills matrix.
[Compensation Committee]
An External Director serves as Chairperson and External Directors constitute the majority of the membership.
Chairperson: Hideki Hirano (External Director)
Members: Noriharu Fujita (External Director), Takaki Yamada (External Director), Hiroshi Takahashi (President andRepresentative Director), and Katsumi Kawashima (Director, Head of Corporate Design Headquarters)
Committee meeting: Held four times

In the Compensation Committee as well, External Directors constitute the majority and an External Director serves as
Chairperson. With the aim of enhancing the independence and objectivity of the function of the Board of Directors and its
accountability regarding the compensation for Directors, etc., the Committee deliberates what the Company’s compensation4

plan for Directors and Corporate Officers should be, the compensation for individual Directors, etc., and reports on the resultsof deliberations regarding Directors who are not Audit and Supervisory Committee Members and Corporate Officers andprovides advice to the Board of Directors. During the fiscal year ended March 31, 2024 the Committee mainly reviewed
performance-linked compensation, reassessed indicators, exchanged opinions on issues related to compensation for Directors
and Corporate Officers toward improving the Company’s corporate value, and determined the amounts of compensation for
Directors and Corporate Officers for report and advice to the Board of Directors.
[Supplementary Principle 4-11-1 Views on Balance, Diversity, and Size of the Board of Directors]
The Company has a basic policy of the Board of Directors consisting of the number of members both necessary and appropriate
to secure the effective management system required for the Company’s group management and ensure that the Board of
Directors has substantial discussions. In addition, the Company endeavors to secure diversity and professional expertise byelecting female External Directors, while also electing External Directors who have expertise in corporate management,
overseas experience, qualifications as an attorney and expertise in finance and accounting. The Company’s policies andprocedures for electing Directors are as described in Principle 3-1 (iv) above.
As the Company examines whether the Board of Directors as a whole has necessary skills in light of the Company’s
management strategy, the Company produced a skills matrix under the new management structure after Ordinary General
Meeting of Shareholders, which was deliberated by the Board of Directors. This skills matrix is described and disclosed in thenotice of convocation of the Ordinary General Meeting of Shareholders. As External Directors are expected to play animportant role in incorporating changes in the business environment into the Company’s business strategy, the Company has
elected External Directors who have experience in corporate management in the semiconductor industry, among otherindustries.
[Supplementary Principle 4-11-2 Directors Concurrently Serving as Officers at Other Listed Companies]
The Company’s Directors who concurrently serve as officers at listed companies and the offices they concurrently hold aredisclosed in the notice of convocation of the Ordinary General Meeting of Shareholders and the Annual Securities Report. The
Company considers that given the offices they concurrently hold and the status of their attendance at the Company’s Board of
Directors meetings, they have enough time and capacity to fulfill their roles and duties as the Company’s officers.
[Supplementary Principle 4-11-3 Analysis and Evaluation of the Effectiveness of the Board of Directors and the Summary of
the Results]- Evaluation method
In order to evaluate the effectiveness of the Board of Directors, the Company distributed a survey to all of its Directors, asking
about (1) the function and composition of the Board of Directors, (2) the operation of the Board of Directors, (3) the provisionof information for external officers, (4) progress in improvement from the previous year, and (5) overall evaluation, while alsointerviewing External Directors, from February to March 2024, and the data collected from the survey and the results of theiranalysis as well as the results of the interviews were shared and deliberated on by the Board of Directors.
- Summary of the evaluation results
The results of this latest evaluation indicate that the Company’s corporate governance is by and large effective. Specifically, inthe questionnaire survey and interviews with External Directors, respondents expressed a favorable view regarding regularly
held deliberations on major themes and discussions intended to communicate information to External Directors, as well as
toward the fact that the Board of Directors has become more diverse. Meanwhile, some respondents pointed out issues in themechanism for timely information disclosure to External Directors and questioned the appropriateness of the current number of
Directors and the diversity of the Board of Directors in terms of age. These results were shared with and deliberated by the
Board of Directors.
- Follow-up measures
Based on the evaluation results, the Board of Directors will continue to hold discussions to recognize issues and examine
improvement measures, etc., and will strive to further improve the effectiveness of the Board of Directors.
[Supplementary Principle 4-14-2 Training Policies for Directors]
The Company has provided training programs for newly elected officers and candidates for future executives to help themacquire the knowledge, etc., necessary to fulfill their roles and duties as the Company’s officers, and going forward, it will
extend the programs to a broader range of targets, while also working to raise program levels. In addition, the Company will
strive to provide and arrange training opportunities suitable for individual officers, encourage each of them to work on selftraining, and offer necessary financial support to them.
[Principle 5-1 Policies for Constructive Dialogues with Shareholders]

5The Company places a high value on constructive dialogues with shareholders, and the members of its management team areleading the effort to take every opportunity to have dialogues with shareholders. Through these dialogues, the Company isworking to enhance shareholders’ understanding of its management policy as well as listening to and considering their analysesof the Company’s management and their opinions to achieve the Group’s sustainable growth and increase its medium- to longterm corporate value. Based on these policies, the Company implements financial results briefing sessions, IR activities, etc.,with the Corporate Design Headquarters playing a central role. A summary of the status of the implementation of dialogues
with shareholders is disclosed in the Sanken Report (integrated reports), which is posted on the Company’s website:
https://www.sanken-ele.co.jp/corp/tousika/tousika01.htm(i)(ii) Financial results briefing sessions and IR activities are implemented by the Corporate Design Headquarters, with the
Corporate Planning, Investor Relations, Legal, and Accounting Departments providing support as needed. Interviews withinstitutional investors are attended by President and Representative Director and the Head of the Corporate Design
Headquarters as needed.
(iii) The Company considers the General Meeting of Shareholders an important opportunity for dialogue, and is striving todisclose its business information adequately at the meeting, while also making an effort to operate the meeting so as to be able
to gain shareholders’ trust in the Company. In addition, the Company is striving to achieve closer communication withshareholders and investors by holding financial results briefing sessions and small meetings regularly.
(iv) The Company has the departments in charge put together opinions and concerns about the Company collected throughdialogues with shareholders and investors and report on these opinions and concerns, depending on their level of importanceand nature, to the members of the Company’s management team regularly.
(v) The basic policy of the Company is to strive to disclose information fairly in order to ensure substantive equality amongshareholders and investors. Based on this policy, the Company discloses material information about the Company in a timely
and fair manner, and works to ensure proper information management so as not to provide such information only to certain
shareholders or investors.
[Principle 5-2 Establishing and Disclosing Business Strategies and Business Plans[Initiatives to achieve management that lays emphasis on capital costs and share prices]
The Company has formulated and is driving forward the 2024 Medium-Term Management Plan, which is a four-year plan that
positions fiscal 2024 as a period of recovery from the impact of the 2024 Noto Peninsula Earthquake. To achieve consolidated
targets, the Company considers increasing corporate value by improving Sanken Core’s profitability as the top priority, and“net sales CAGR of 10% or higher” and “operating profit margin of 10% or higher” have been set as Sanken Core’s KPIs. In
addition, the Company will lay emphasis on not only profitability improvement but also capital costs and capital efficiency,such as fab-light strategy and promotion of collaboration with external organizations, as growth strategies for Sanken Core.
To provide long-term incentives to Directors, the Company has introduced a stock compensation plan as part of thecompensation plan for Directors. Based on the deliberation by the Compensation Committee, consolidated ROE and relative
total shareholder return (TSR) (evaluation relative to TOPIX electric appliances index), among others, have been set as key
performance indicators (KPIs) to create a design that lay emphasis on capital costs and share prices. For details, please see“Section 4. Information about Reporting Company: 4. Corporate Governance (4) Compensation for Officers” in the Company’s
Annual Securities Report for the 107th fiscal year posted on the Company’s website:

https://www.sanken-ele.co.jp/corp/tousika/houkoku_yuuka.htm
Financial results presentation for the fiscal year ended March 2024:
https://www.sanken-ele.co.jp/corp/en/tousika/briefing.htm

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2. Capital Structure
Foreign Shareholding Ratio

30% or more

Status of Major Shareholders Updated
Name or Company Name

Number of Shares Owned

Percentage (%)

ECM MF

2,722,357

11.23

The Master Trust Bank of Japan, Limited (Trust Account)

2,450,700

10.11

Saitama Resona Bank, Limited

1,202,392

4.96

Goldman Sachs International

941,708

3.88

Suntera (Cayman) Limited as trustee of ECM Master Fund

905,900

3.73

BNP PARIBAS LUXEMBOURG/2S/JASDEC SECURITIES/UCITS

839,800

3.46

Custody Bank of Japan, Ltd. (Trust Account)

787,600

3.25

MLI FOR CLIENT GENERAL OMNI NON COLLATERAL NON

767,492

3.16

Shinsei Trust & Banking Co., Ltd. ECM MF TRUST ACCOUNT 8299005

650,000

2.68

J.P. MORGAN SECURITIES PLC FOR AND ON BEHALF OF ITS
CLIENTS JPMSP RE CLIENT ASSETS-SEGR ACCT

561,800

2.31

ASSETS

TREATY-PB

Name of Controlling Shareholder, if applicable(excluding Parent Companies)―

Name of Parent Company, if applicableNot applicable

Supplementary Explanation Updated- The above information shows the status of the Company’s major shareholders as of March 31, 2024.
- The Company holds 874,214 shares of treasury stock that are excluded from the major shareholders listed above.
- Percentage of ownership is calculated after deducting the number of shares held as treasury shares from the total number ofshares issued, and presented rounded down to two decimal places.
- While large-volume holding reports (change reports) were submitted by the following large-volume shareholders by the endof the fiscal year 2023, these shareholders are not included in the status of the Company’s major shareholders stated above,as the Company is unable to confirm the number of its shares held by these shareholders:
1. Effissimo Capital Management Pte Ltd
2. Wellington Management Company LLP and three other companies

7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) for the Previous Fiscal
Year
Number of Consolidated Subsidiaries as of the Endof the Previous Fiscal YearTokyo Stock Exchange, Prime Market
MarchElectrical appliances
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 a Material Impact on Corporate Governance―

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

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
Number of Directors Updated
Election of External Directors
Number of External Directors
Number of Independent Directors among External
Directors

20
One year
President
11Elected778External Directors’ Relationship with the Company (1) Updated

Name

Relationship with the Company*

Attributes

Noriharu Fujita

Certified public accountant

Takaki Yamada

From another company

Hideki Hirano

From another company

Yumi Ogose

Academic

Mariko Sugawara

Attorney-at-law

Atsushi Minami

Attorney-at-law

Yumiko Moritani

From another company

a

b

c

d

e

f

g

h

i

j

k

△

△

△

*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 a close relative of the director fell under the category in the past.)
a. Person who executes business for the Company or its subsidiary
b. Person who executes business for a non-executive director of the Company's parent company
c. Person who executes business for a fellow subsidiaryd. Person/entity for which the Company is a major client or a person who executes business for said person/entity
e. Major client of the Company or a person who executes business for said clientf. Consultant, accounting expert, or legal expert who receives large amounts of cash or other assets from the Company in addition
to remuneration as a director/company auditor
g. Major shareholder of the Company (in cases where the shareholder is a corporation, a person who executes business for the
corporation)h. Person who executes business for a client of the Company (excluding persons categorized as any of d, e, or f above) (applies todirector him/herself only)
i. Person who executes business for another company that holds cross-directorships/cross-auditorships with the Company (applies
to director him/herself only)
j. Person who executes business for an entity receiving donations from the Company (applies to director him/herself only)
k. Other9External Directors’ Relationship with the Company (2) Updated

Name

Noriharu Fujita

Membership ofAudit andSupervisory
Committee

Designation as
Independent
Director○

Supplementary Explanation of
the RelationshipThough Mr. Noriharu Fujita
once belonged to an audit
corporation engaged as the
Accounting Auditor of theCompany, he was not directly
involved in the accounting auditof the Company and instead
served as the JBS Global
Services Leader mainly engaged
in consulting for companies in
the audit corporation.
Furthermore, as more than ten
years have passed since hisretirement from the above audit
corporation, there are nointerests between him and theaudit corporation. The Company
therefore believes that he canmaintain an independent
standpoint and supervise theCompany’s management froman objective viewpoint.
Meanwhile, the amount of theaudit compensation, etc., paid by
the Company to its Accounting
Auditor is within a generally
accepted range and the audit
corporation serving as the
Accounting Auditor also serves
as the accounting auditor at alarge number of companies.
Therefore, the audit corporation
is not materially dependent on
the audit compensation paid by
the Company. In view of thesesituations, the Company
considers that Mr. Fujita would
not be significantly controlled
by the Company’s management
and that he would not
significantly control the
Company’s management.
Accordingly, the Company
considers that Mr. Fujita’s
independence is secured and thata conflict of interest is unlikely
to arise between Mr. Fujita andthe Company’s generalshareholders.

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Reasons for Appointment
Mr. Noriharu Fujita is qualified
as a CPA in Japan and the U.S.
and has acquired deep
knowledge about finance andaccounting. Based on his
abundant international
experience as a partner in a U.S.
auditing firm and other positions,
he has given valuable advice andopinions from the viewpoint ofpromoting global management.
Though Mr. Noriharu Fujita once
belonged to an audit corporation
engaged as the Accounting
Auditor of the Company, he was
not directly involved in theaccounting audit of the Company
and instead served as the JBS
Global Services Leader mainly
engaged in consulting forcompanies expanding theirbusinesses overseas.
Furthermore, as more than ten
years have passed since hisretirement from the above audit
corporation, the Company
believes that he can maintain an
independent standpoint andsupervise the Company’s
management from an objective
viewpoint. He currently serves asa member of the Nomination
Committee and has madecontributions to the Company’s
corporate governance for
ensuring its transparency andenhancing its adequacy.
Furthermore, he has also
contributed to ensuring theappropriateness and adequacy inthe promotion of the Group
growth strategies throughdiscussions among officers todeliberate important topics atmeetings that are regularly held
other than the Board of Directors
meetings. He also has extensive
knowledge in the semiconductor
industry inside and outside Japanas he previously held offices as
an External Director of principal

Name

Takaki Yamada

Membership ofAudit andSupervisory
Committee

Designation as
Independent
Director○

Supplementary Explanation of
the Relationship―

11

Reasons for Appointment
U.S. subsidiaries of theCompany. His knowledge is
expected to make similar
contributions to supervising themanagement of the corporategroup.
For the reasons above, theCompany believes that he willappropriately perform his duties
such as ensuring theappropriateness of overallbusiness execution andstrengthening supervisory
functions as well as contribute toensuring the transparency of theCompany’s corporate
governance and enhancing its
adequacy, while the Group will
promote a medium- to long-term
growth strategy.
Mr. Takaki Yamada has many
years of experience atsemiconductor manufacturers
and is well-versed in thesemiconductor industry andbusiness. He also has corporate
management experience insemiconductor manufacturing
gained through the years at Oki
Electric Industry Co., Ltd. byserving as President of
Semiconductor Production
Company and President andDirector of the overseas
production subsidiary company.
During the foundation of UACJ
(Thailand) Co., Ltd. he leveraged
his overseas experience to lead alarge-scale project. Currently, as
Vice President of Thai Special
Gas Co., Ltd., he possesses a
wealth of work experience invarious fields and maintains avast network of connections byactively being engaged inbusiness development.
He currently serves as a memberof the Nomination Committee
and the Compensation
Committee and has madecontributions to the Company’s
corporate governance for
ensuring its transparency andName

Hideki Hirano

Membership ofAudit andSupervisory
Committee

Designation as
Independent
Director○

Supplementary Explanation of
the Relationship

While Mr. Hideki Hirano once
worked at a bank with which theCompany has transacted, heretired from the bank as its
officer in 2010 and now there
are no interests between him andthe bank.
Meanwhile, the Company hasloans from multiple financial
institutions and the balance ofloans from the bank accounts forless than 2% of the total balanceof bank loans at the end of the
fiscal year ended March 31,
2024. Accordingly, the Company
is not materially dependent on
the bank. In view of thesesituations, the Company
considers that Mr. Hirano would
not be significantly controlled
by the Company’s management
and that he would not
significantly control the
Company’s management.

12

Reasons for Appointment
enhancing its adequacy.
Furthermore, he has also
contributed to ensuring theappropriateness and adequacy inthe promotion of the Group
growth strategies throughdiscussions among officers todeliberate important topics atmeetings that are regularly held
other than the Board of Directors
meetings. The Company
therefore anticipates that he willcontribute to ensuring theappropriateness of overallbusiness execution, and present
fruitful advice in an effort topromote business for the
corporate group as asemiconductor manufacturer.
For the reasons above, theCompany believes that he willappropriately perform his duties
as an External Director, such as
ensuring the appropriateness ofoverall business execution andstrengthening supervisory
functions, while the Group will
promote a medium- to long-term
growth strategy.
Mr. Hideki Hirano has deep
knowledge in finance andaccounting based on his
background in the banking
business. In addition, we believethat his experience as an
Executive Officer will contributeto strengthening supervisory
functions of business execution
from the viewpoint ofmanagement. In 2019 heassumed office as External Audit
and Supervisory Board Memberof the Company and has anunderstanding of the Company’sbusiness. He currently serves as
the chairperson of theNomination Committee and theCompensation Committee andhas made contributions to theCompany’s corporate
governance for ensuring its
transparency and enhancing its
adequacy. Furthermore, he has

NameMembership ofAudit andSupervisory
Committee

Designation as
Independent
Director

Supplementary Explanation of
the Relationship
For these reasons, the Company
considers that Mr. Hirano’s
independence is secured and thata conflict of interest is unlikely
to arise between Mr. Hirano and
the Company’s generalshareholders.

Yumi Ogose

○

―

13

Reasons for Appointment
also contributed to ensuring theappropriateness and adequacy inthe promotion of the Group
growth strategies throughdiscussions among officers todeliberate important topics atmeetings that are regularly held
other than the Board of Directors
meetings.
For the reasons above, theCompany believes that he willappropriately perform his duties
such as ensuring theappropriateness of overallbusiness execution andstrengthening supervisory
functions as well as contribute toensuring the transparency of theCompany’s corporate
governance and enhancing its
adequacy, while the Group will
promote a medium- to long-term
growth strategy.
Ms. Yumi Ogose serves as a fulltime professor of the Departmentof Management of Technology at
the Graduate School ofManagement of Tokyo
University of Science and isengaged in developing humanresources who can build businesscompetitive advantage using
technology and culture from theperspective of corporate
management. Based on her
knowledge gained therefrom, theCompany anticipates that she
will present valuable advice andopinions in the Company’s
management of technology froman objective viewpoint. Patent isa crucial element of the corporate
growth and she has many yearsof experience in the intellectual
property area. She not only
serves as a university professor,
but also has been active invarious fields such as serving asa member of the Committee forContents and Japan Brand
Promotion of the Intellectual
Property Strategy Headquarters,a Cabinet body. Based on her

Name

MarikoMembership ofAudit andSupervisory
Committee

Designation as
Independent
Director○

Supplementary Explanation of
the Relationship―

Sugawara

14

Reasons for Appointment
knowledge gained from many
years of these academic
activities, the Company believes
that she will present valuableadvice and opinions regarding its
intellectual property strategy
from an objective viewpoint. She
currently serves as a member of
the Compensation Committee
and has made contributions to
the Company’s corporate
governance for ensuring its
transparency and enhancing its
adequacy. Furthermore, she has
also contributed to ensuring theappropriateness and adequacy inthe promotion of the Group
growth strategies throughdiscussions among officers todeliberate important topics atmeetings that are regularly held
other than the Board of Directors
meetings. We also believe that
she will present fruitful advice
and opinions as female External
Director from the perspective of
diversity such as theadvancement of female
employees in the Company,
especially from a third-party
viewpoint regarding the
Sustainability Committee of theCompany.
For the reasons above, theCompany anticipates that she
will appropriately perform her
duties such as ensuring theappropriateness of overallbusiness execution andstrengthening supervisory
functions as well as contribute toensuring the transparency of theCompany’s corporate
governance and enhancing its
adequacy, while the Group will
promote a medium- to long-term
growth strategy.
Ms. Mariko Sugawara has
engaged in corporate legal affairs
and M&A in various industries
as well as tax suits in the field oftax laws, which is her area ofstudy, and has a wealth of

NameMembership ofAudit andSupervisory
Committee

Designation as
Independent
Director

Supplementary Explanation of
the Relationship

Reasons for Appointment
knowledge and experience as alegal professional. Accordingly,
the Company believes that she
will present valuable advice andopinions in the areas of legal risk
and compliance. She is expected
to monitor management
objectively from an independent
standpoint as an attorney-at-law,
and the Company anticipates that
she will also contribute tostrengthening the supervisory
function of the Company’s Boardof Directors. She currently serves
as a member of theCompensation Committee andhas made contributions to theCompany’s corporate
governance for ensuring its
transparency and enhancing its
adequacy. Furthermore, she isalso expected to contribute toensuring the appropriateness andadequacy in the promotion of theGroup growth strategies throughdiscussions among officers todeliberate important topics atmeetings that are regularly held
other than the Board of Directors
meetings. We also believe that
she will present fruitful advice
and opinions as female External
Director from the perspective of
diversity such as theadvancement of female
employees in the Company,
especially from a third-party
viewpoint regarding the
Sustainability Committee of theCompany.
For the reasons above, theCompany anticipates that she
will appropriately perform her
duties such as ensuring theappropriateness of overallbusiness execution andstrengthening supervisory
functions as well as contribute toensuring the transparency of theCompany’s corporate
governance and enhancing its
adequacy, while the Group will
promote a medium- to long-term

15

Name

Membership ofAudit andSupervisory
Committee

Designation as
Independent
Director

Supplementary Explanation of
the Relationship

AtsushiMinami○○―

YumikoMoritani○○

While Ms. Yumiko Moritani
once worked at a bank withwhich the Company has
transacted, she retired from thebank as its officer in 2011 andnow there are no interests
between her and the bank.
Meanwhile, the Company hasloans from multiple financial
institutions and the balance ofloans from the bank accounts forless than 2% of the total balanceof bank loans at the end of the
fiscal year ended March 31,
2024. Accordingly, the Company
is not materially dependent on
the bank. In view of thesesituations, the Company
considers that Ms. Moritani
would not be significantly
controlled by the Company’s
management and that she would
not significantly control the
Company’s management.
For these reasons, the Company
considers that Ms. Moritani’s
independence is secured and thata conflict of interest is unlikely
to arise between Ms. Moritaniand the Company’s general

16

Reasons for Appointment
growth strategy.
Mr. Atsushi Minami has
professional knowledge andexperience as an attorney-at-law
and patent attorney. The
Company believes that byassuming office as External
Director who is an Audit andSupervisory Committee Member,
he will contribute to ensuring theadequacy and appropriateness ofdecision-making at the Board of
Directors and the effectivenessof audits in the Audit andSupervisory Committee from an
objective perspective as a legal
professional.
For the reasons above, theCompany anticipates that he willappropriately perform his duties
as an External Director who is an
Audit and Supervisory
Committee Member.
Ms. Yumiko Moritani has deep
knowledge in finance andaccounting and experience andknowledge in the areas ofadministration and sales basedon her many years of work
experience at banks. She also has
experience of serving as Audit
and Supervisory Board Memberof Saitama Resona Bank. As she
served as External Director of alisted company related to system
consulting, etc., she also has
extensive knowledge ofmanagement. The Company
anticipates that her experience
will contribute to ensuring theadequacy and appropriateness ofdecision-making at the Board of
Directors and the effectivenessof audits in the Audit andSupervisory Committee from an
objective perspective.
Furthermore, the Company also
believes that she will present
fruitful advice and opinions as
female External Director fromthe perspective of diversity suchas the advancement of female
employees in the Company,

Name

Membership ofAudit andSupervisory
Committee

Designation as
Independent
Director

Supplementary Explanation of
the Relationshipshareholders.

Reasons for Appointment
especially from a third-party
viewpoint regarding the
Sustainability Committee of theCompany.
For the reasons above, theCompany anticipates that she
will appropriately perform her
duties as an External Director
who is an Audit and Supervisory
Committee Member.

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

Full-time Members

Internal Directors

External Directors

Committee Chair

1

1

2

Internal Director

3

Appointment of Directors and/or Staff to Support
the Audit and Supervisory Committee

Appointed

Matters Concerning Independence of Said Directors and/or Staff from Executive Officers
Please see “Matters regarding Directors and employees to support the Audit and Supervisory Committee” in “1. Basic Views on
Internal Control System and Status of Development” of “IV. Matters Concerning the Internal Control System.”

Cooperation among the Audit and Supervisory Committee, Accounting Auditors and Internal Audit Department
At Board of Directors meetings, the Audit and Supervisory Committee provides External Directors (excluding Directors who
are Audit and Supervisory Committee Members) with an outline of its audit plan at the beginning of each fiscal year andregularly reports on the status of audit results based on the plan for information sharing. The report on the status of auditing
also covers the results of the Accounting Auditor’s audit and the status of communication between the internal control
department and the Audit and Supervisory Committee. As efforts of cooperation between the internal control department andthe Audit and Supervisory Committee, a meeting is held regularly each month between full-time Audit and Supervisory
Committee Members and the internal control department, while the internal control department attends Audit and Supervisory
Committee meetings to present its report, in order for the Audit and Supervisory Committee to learn about the status of theinternal control department’s activities.
In addition, as efforts of cooperation between the Accounting Auditor and the Audit and Supervisory Committee, the Audit andSupervisory Committee meet with the Accounting Auditor to ask about the results of the quarterly review and annual audit andhold discussions in order to strengthen their communication.

17

Voluntarily Established Committee(s)Voluntary Establishment of Committee(s) equivalent toNomination Committee or Compensation Committee

Established

Status of Voluntarily Established Committee(s), Attributes of Members Constituting the Committee and the Committee
Chairperson Updated
Committee’s
Name
Voluntarily
Established
Committee
Equivalent toNomination
Committee
Voluntarily
Established
Committee
Equivalent toCompensation
Committee

All
Members

Full-timeMembers

InsideDirectors

External
Directors

External
Experts

Nomination
Committee

4

1

1

3

0

0

External Director

Compensation
Committee

6

2

2

4

0

0

External Director

Other

Chairperson

Supplementary Explanation Updated
The Company has established the Nomination Committee and the Compensation Committee as voluntary advisory bodies for
the Board of Directors to improve adequacy and transparency regarding the nomination of Directors and the compensation for
Directors.
In the Nomination Committee, External Directors constitute the majority of the membership and an External Director serves as
Chairperson. With the aim of enhancing the independence and objectivity of the function of the Board of Directors and its
accountability regarding the nomination of Representative Directors, Directors, Corporate Officers, etc., the Nomination
Committee deliberates on candidates for the successor of President and Representative Director and their development plans,
the election of Directors and Corporate Officers, etc., and reports on the results and provides advice to the Board of Directors.
Regarding the status of the activities of the Committees, etc., please see “4-10-1 Nomination Committee and Compensation
Committee” of “Disclosure Based on each Principle of the Corporate Governance Code.”

Matters Concerning Independent Directors
Number of Independent Directors

718

Other Matters Concerning Independent Directors
The Company has designated as independent officers all of the External Directors (including External Directors who are Audit
and Supervisory Committee Members).

Incentives
Implementation Status of Measures related toIncentives Granted to Directors

Introduction of performance-linked compensation plan

Supplementary Explanation for Applicable Items
Please see the disclosures stated in “Policy on Determining Compensation Amounts and Calculation Methods” below.
Persons Eligible for Stock Options

Supplementary Explanation for Applicable Items―

Director Compensation
Status of Disclosure of Individual Director’sCompensation

No disclosure for any Directors

Supplementary Explanation for Applicable Items
The total amount of compensation for each of the Director categories is disclosed in the Annual Securities Report.
Policy on Determining Compensation Amounts andCalculation Methods Updated

Established

Disclosure of Policy on Determining Compensation Amounts and Calculation Methods
Basic concept for the compensation plan for officers
The Company considers its compensation plan for officers (compensation plan for executive officers) as an important corporate
governance matter and has adopted a basic concept for the compensation plan as follows.
- Contributing to the procurement of excellent human resources- Setting levels of compensation appropriate for the role and scope of responsibility for each rank
- Providing incentives toward the increased corporate value and sustainable growth of the Company- Ensuring transparency and objectivity in the procedure for determining compensation
Overview of the compensation plan for officers
Based on the aforementioned basic concept for the compensation plan for officers, the policy for deciding the details of
individual compensation, etc. payable to Directors (excluding Directors who are Audit and Supervisory Committee Members;
the same applies hereinafter) is decided by the Board of Directors based on the results of deliberations by the Compensation
Committee, the majority of which is External Directors (the “Policy for Deciding the Compensation”). The Policy for Deciding
the Compensation is outlined below.
• Compensation for the Company’s Directors is determined according to their rank and role, and consists of basic
compensation paid monthly and performance-linked compensation that changes depending on the degree of achievement of
earnings targets. Performance-linked compensation is designed to provide short-term incentives paid every fiscal year thatvary based on short-term earnings and long-term incentives that vary based on the medium- to long-term earnings and are
granted upon their retirement, in principle, under a stock compensation plan (trust type stock issuance).
• With regard to compensation standards for Directors, standard amounts for the total compensation are determined for eachrank. To ensure market competitiveness, the adequacy of the standard amounts is verified each year using the findings of acompensation survey administered to major companies in Japan as a benchmark. The ratio of performance-linked

19compensation and consolidated performance indicators for performance-linked compensation are determined based on theabove-mentioned basic concept of the compensation and the results of deliberations by the Compensation Committee. At
present, performance-linked compensation is set at about 40% of total compensation when earnings targets are fully
achieved.
• Compensation for External Directors (excluding Audit and Supervisory Committee Members) consists solely of basic
compensation based on the nature of responsibilities for the position of Director, and it is not linked to performance. Also,
compensation for Directors who are Audit and Supervisory Committee Members consists solely of basic compensation basedon the nature of responsibilities for the position of auditor and it is not linked to performance, and compensation for Directors
who are Audit and Supervisory Committee Members is paid through consultation with Directors who are Audit andSupervisory Committee Members.
• Short-term incentives vary within a range of 0-150% of standard pay, in principle, and are linked to performance indicatorsfor individual fiscal years in order to further raise the motivation of directors to achieve the Company’s performance targets
for that fiscal year. The performance-linked indicators have been determined through deliberations by the Compensation
Committee, and consist of consolidated operating profit etc., the Company’s key performance targets. Additional individual
indicators are set depending on the roles expected of each individual.
• With regard to long-term incentives, a stock compensation plan has been introduced to enhance the incentive to contribute tomedium- and long-term corporate value, align the interests of Directors with those of shareholders, and raise the motivationto achieve performance targets and structural reform objectives stated in the Company’s medium-term management plan.
Long-term incentives vary within a range of 0-150% of standard pay, in principle, and are linked to rank and performanceindicators during the period of the medium-term management plan. The performance-linked indicators for all Directors havebeen determined through deliberations by the Compensation Committee, and consist of consolidated operating profit andconsolidated ROE, placing emphasis on business profitability over the medium and long terms. In addition, as an expressionof the Company’s commitment to raising shareholder value, which includes appropriate shareholder returns, relative total
shareholder return (relative TSR) (evaluation relative to TOPIX electric appliances index) has been set as a performancelinked indicator. Further, since April 1, 2023, the Company has added ESG items as performance indicators with the aim ofenhancing ESG management.

Support System for External Directors
The Legal Department, which is the Secretariat’s Office of the Board of Directors and the Audit and Supervisory Committee,
assists in administration and also communicates necessary information in a timely manner to External Directors as needed. In
addition, the internal audit department conducts investigations at the Audit and Supervisory Committee’s request and reports on
the results to the Audit and Supervisory Committee. Moreover, the Secretary Department provides scheduling and otherservices under the support system.

Status of Persons who have Retired as President and Representative Director, etc.
Information on Persons Holding Advisory Positions (Sodanyaku, Komon, etc.) after Retiring as President andRepresentative Director, etc.

Name―

Job title/
position―

Terms and Conditions of
Employment(Full/part time, with/withoutcompensation, etc.)

Responsibilities――

Date when former
role as president/
CEO ended―

Number of Persons Holding Advisory Positions (Sodanyaku, Komon, etc.)
After Retiring as President and Representative Director, etc.

Term
―

―

Other Related Matters Updated
Not applicable.

2. Matters Concerning Functions of Business Execution, Auditing and Supervision, Nomination, andCompensation Decisions (Overview of Current Corporate Governance System) Updated
The Company transitioned to a company with an Audit and Supervisory Committee at the 106th Ordinary General Meeting of20

Shareholders held on June 23, 2023, with the aim of promoting separation of management and execution, adopting amonitoring model for the Board of Directors, and further strengthening the corporate governance system.
For details, please see “Section 4. Information about Reporting Company: 4. Corporate Governance” in the Company’s Annual
Securities Report for the 107th fiscal year posted on the Company’s website:
https://www.sanken-ele.co.jp/corp/tousika/houkoku_yuuka.htm

3. Reasons for Adoption of Current Corporate Governance System Updated
Based on the basic concept of corporate governance, independent External Directors constitute the majority in the Company’s
the Board of Directors. The Company considers that this helps ensure an objective and neutral management supervisory
function of the Board of Directors. Going forward, the Company will continue to explore an appropriate corporate governancesystem for the Company, considering demands from stakeholders and social demands regarding corporate governance, etc.,
comprehensively.

III. Implementation of Measures for Shareholders and Other Stakeholders
1. Measures to Vitalize General Meeting of Shareholders and Facilitate Exercise of Voting Rights
Supplementary Explanation
Scheduling of the General Meeting of
Shareholders on a Non-Peak Day

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 Meeting of Shareholders in
EnglishOther

The Company held this year’s Ordinary General Meeting of Shareholders on
June 21, 2024.
In order to increase the convenience for individual shareholders andinstitutional investors as they exercise voting rights, the Company has
adopted the smart proxy voting platform, which does not require the entry of
an ID or password, and the electronic proxy voting platform, in addition to
the system for exercising voting rights via the Internet using a PC.
The Company has joined the electronic proxy voting platform operated by
ICJ, Inc., while disclosing the notice of convocation of the General Meetingof Shareholders in the PDF file format (Japanese and English versions areavailable) before sending out the written notice.
The Company has posted on its website the Japanese and English versions of
the notice of convocation of the General Meeting of Shareholders.
The Company holds a participatory virtual General Meeting of Shareholders
by livestreaming the General Meeting of Shareholders.
The video of the livestream is later made available for on-demand streaming.

21

2. Status of IR-related Activities
Supplementary Explanation

Formulation and Publication of Disclosure
Policies
Regular Investor Briefings held for Analysts
and Institutional Investors

Online Disclosure of IR Information

Establishment of Department and/or Placementof a Manager in Charge of IR

The Company has formulated and published on its
website its disclosure policies.
The Company holds briefings for analysts andinstitutional investors twice a year.
In order to help appropriate investment decision andappropriate proxy voting, the Company has posted andpublished on its website its Securities Reports, notices ofconvocation of the General Meeting of Shareholders,earnings reports, documents for timely disclosure,
Sanken Reports (integrated reports), presentationmaterials for the financial results briefing session, news
releases, etc.
The Company has established the Investor Relations
Division, Corporate Planning Office, Corporate Design
Headquarters as a department in charge of IR.

Explanation by aRepresentative
Director or a
Representative
Executive Officer

Held

3. Status of Measures to Ensure Due Respect for Stakeholders
Supplementary Explanation
Establishment of Internal Rules Stipulating
Respect for the Position of Stakeholders
Implementation of Environmental
Preservation Activities and CSR Activities,
etc.
Formulation of Policies, etc. for Information
Disclosure to Stakeholders
Other

The Company has laid down the rules in the Management Philosophy, Codeof Conduct, Management Vision, Conduct Guideline, and Sanken Group
Basic CSR Policy.
For the Company’s environmental preservation activities, CSR activities, etc.,
please see the Company’s sustainability website.
https://www.sanken-ele.co.jp/corp/csr/index.htm
The Company publishes the Sanken Report (integrated reports) every year.
Non-financial data regarding sustainability is disclosed in the report.
The Company’s respect for human rights and diversity initiatives aredisclosed on its sustainability website.
https://www.sanken-ele.co.jp/corp/csr/index.htm

IV. Matters Concerning the Internal Control System
1. Basic Views on Internal Control System and Status of Development
The Company’s basic policy for the internal control system is as follows.
(System for ensuring that the Directors and employees perform their duties in accordance with laws, regulations, and the Article
of Incorporation)(i) The Board of Directors deliberates material business execution, supervises the execution of duties by each Director, andchecks legality, in accordance with “Regulations of the Board of Directors.”(ii) The Company establishes and implements a “Management Philosophy,” “Code of Conduct,” and Sanken Conduct
Guideline.” The Company also ensures that the executives and employees comply with laws, regulations and the Articles ofIncorporation, by familiarizing them with the compliance mindset and the importance of compliance and by implementing
ongoing educational training activities, both arranged by Representative Directors.
(iii) The internal audit department audits the performance of duties in the Company and each of the group companies andensures the effectiveness of the compliance system by making the most of a whistle-blowing protocol.
(iv) To appropriately respond to the internal control report system (hereinafter referred to as “J-SOX”) under the Financial
Instruments and Exchange Act, the Company has established a person in charge of J-SOX at its internal audit department andsecures the reliability of financial information by undertaking a company-wide review of the control systems and measures toimprove the systems on an ongoing basis.

22

(v) The Company has no relationship with antisocial forces. The Company usually endeavors to establish close relationships
and cooperation systems with external organizations such as police agencies and lawyers. Should the Company be subject to an
undue claim, it will adopt a resolute stand and decisively refuse it.
(System for the storage and management of information with regard to the execution of duties by Directors)
The Minutes of the Board of Directors and other documents and records on important meetings, as well as the results ofdecision-making and other records on business execution, shall be appropriately stored and managed in accordance with laws,
regulations, and various internal rules.
(Rules and other aspects of the system for managing risks of loss)(i) Risks associated with key investments or new businesses are discussed from various viewpoints and determined
deliberatively at the Board of Directors, Management Committee, and other important meetings.
(ii) The risk management department collects and analyzes data on various risks related to overall management,
reports the details of such risks to management, and proposes countermeasures to improve the situation. The internal audit
department recognizes and analyzes risks in the course of business for the Company and group companies through internal
audits, and reports the results of internal audits to the Board of Directors and the Audit and Supervisory Committee.
(System for ensuring that the duties of the Directors are efficiently performed)(i) The Board of Directors formulates the mid-term management plan and annual budget, and checks the progress of businessexecution based on the report on the progress of achievement, while the Management Committee is responsible for monthly
performance management.
(ii) The Management Committee discusses basic and material matters among the items on the agenda to be resolved at theBoard of Directors and the business operations to be executed by the Representative Directors. It also performs businesspromptly and flexibly using the corporate officer system.
(iii) The Company develops “the Fundamental Standards for Organization and Authorities,” “the Regulations on the Division of
Duties,” etc. to clarify the responsibilities and authorities of each department. The Company also conducts efficient decisionmaking and business execution through efforts for the appropriate division of duties and cooperation among organizations.
(System for ensuring appropriate business operations within the Company and within each group company)(i) When necessary, the Company sends its officers and employees to Group companies as incoming directors to follow up on
the Company’s management policy, determine material business-related issues, and promote efficient management.
(ii) The scope of duties, authorities and responsibilities between the Company and each group company, as well as the mattersto be reported to the Company, are clarified in accordance with “the Administration Standards for Subsidiaries and Affiliates”
and ‘the Management Guidelines.”(iii) An organization in charge of each group company is established at the Company to bear responsibility for the guidance ofmanagement and enhancement of managerial performance through close information sharing.
(Matters regarding Directors and employees to support the Audit and Supervisory Committee)(i) Staff of the Legal Department will assist the deskwork of the Secretariat’s Office of Audit and Supervisory Committee.
(ii) When the Audit and Supervisory Committee so requests, the appointment and other personnel affairs of exclusive staff forthe support of the Audit and Supervisory Committee shall be determined through consultation with the Audit and Supervisory
Committee.
(iii) Such exclusive staff shall comply with instructions from the Audit and Supervisory Committee to ensure their
independence from Directors (excluding Directors who are Audit and Supervisory Committee Members) and the effectivenessof the instructions from the Audit and Supervisory Committee.
(System for reporting to Audit and Supervisory Committee)(i) Full-time Audit and Supervisory Committee Members attend the Management Committee meetings, inspect and receive
principal documents, thereby obtain information on the businesses of the Company and group companies, and report thecontents of such information to the Audit and Supervisory Committee.
(ii) Representative Directors and other Directors (excluding Directors who are Audit and Supervisory Committee Members),
internal audit department, and the Accounting Auditor each meet with the Audit and Supervisory Committee regularly to report
the management situations of the Company and group companies and audit results.
(iii) If officers or employees find any fact or event which is likely to cause material damage to the Company or any of the groupcompanies or discover any illegal actions in the course of business operations, such officers or employees must report thematter to the Audit and Supervisory Committee.
(iv) The internal audit department reports the results of internal audits, the status of implementation of the whistle-blowing
protocol, and the contents of whistle-blowing to the Audit and Supervisory Committee.

23

(v) Regulations on the whistle-blowing protocol are stipulated to ensure that a whistle-blower will not be subjected to any
disadvantageous treatment because of the said whistle-blowing.
(Policy for handling expenses and liabilities incurred from the execution of duties by Audit and Supervisory Committee
Members (limited to the execution of the duties of the Audit and Supervisory Committee))If, with respect to any expenses or liabilities to be incurred when Audit and Supervisory Committee Members perform theirduties, the Audit and Supervisory Committee Members request the Company to pay them in advance, repay them, or otherwise,
the Company shall promptly process the expenses or liabilities unless they are judged to be unnecessary.
(Other system for ensuring effective auditing by the Audit and Supervisory Committee)(i) The Audit and Supervisory Committee draws up the auditing standards, audit plans, and audit policies. Each Audit andSupervisory Committee Member conducts audits properly based on his own expertise and experience. An efficient and highly
effective audit system is realized through these efforts.
(ii) The internal audit department obtains approval of its audit plan from Representative Directors and the Audit andSupervisory Committee and reports on audit results to Representative Directors, the Board of Directors, and the Audit andSupervisory Committee. In addition, the internal audit department reports on the status of internal audits to the Audit andSupervisory Committee.
(iii) The internal audit department follows instructions that may be provided by the Audit and Supervisory Committee regarding
internal audits. If there is any discrepancy between the Audit and Supervisory Committee’s instructions and Representative
Directors’ instructions, the internal audit department prioritizes the Audit and Supervisory Committee’s instructions.
For the status of the development of the internal control system, please see the Business Report described in the notice ofconvocation of the Ordinary General Meeting of Shareholders.

2. Basic Views on Measures for Eliminating Antisocial Forces and Status of Development
The Company has no relationship with antisocial forces. The Company usually endeavors to establish close relationships andcooperation systems with external organizations such as police agencies and lawyers. Should the Company be subject to an
undue claim, it will adopt a resolute stand and decisively refuse it.

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

Not adopted

Supplementary Explanation for Applicable Items
The basic policy on the composition of persons to control decision-making over financial and business policies of the Company
and measures to realize the basic policy are as follows:(1) As a listed Company, the stock of the Company may be traded freely by shareholders and investors, and the Board of
Directors believes that the composition of persons to control decision-making over the financial and business policies of theCompany should ultimately be decided by the will of the shareholders, and that the final judgment as to whether to sell theshares of the Company in response to a mass acquisition of the shares of the Company should ultimately be decided based on
the will of the shareholders holding the shares. However, the management of the Company and the Company Group requires awide range of know-how and ample experience, including proprietary semiconductor device assembly technologies, such as
wafer fabrication and packaging technologies, as well as product development leveraging circuit design and modularization
technologies. Further, a full understanding of the relationships that the Company has developed with stakeholders such as
customers, suppliers, and employees is indispensable to management. Persons to control decision-making over financial andbusiness policies of the Company require this understanding in order to appropriately judge the shareholder value to be realized
in the future, and could potentially significantly damage the Company’s corporate value and the common interests of theshareholders without it.
In addition, there is a possibility that some Large Purchases, such as to persons related to the Company conducting transactions
at high prices, could substantially impair the common interests of the shareholders. In such cases, in order for the Company toappropriately receive the judgment of the shareholders regarding the relative merits and demerits of a given large-scalepurchase, the Company will both request the supply of required information from the entity attempting to engage in the large-24

scale purchase and will also strive to ensure there is an appropriate amount of time for the disclosure of such information anddeliberation on it by shareholders. Regarding the extents that are permitted by laws and regulations such as the Financial
Instruments and Exchange Act, we believe that appropriate measures should be taken (Hereinafter referred to as the “Basic
Policy”).

(2) Measures Taken to Realize the Basic Policy and Increase Corporate Value
The Company has acted in accordance with its Management Philosophy, which states that the Company should endeavor tocreate and innovate technologies in its core business of semiconductors, expand global business based on proprietary
technologies, and ensure a firm management base in order to maximize corporate value through timely response to social
expectations for the company and long-lasting harmony with the environment. Furthermore, as a medium- to long-term
management strategy, the Company has developed a medium-term management plan that the entire
Group has worked toward.
Also, the Company is involved in efforts to gain an appropriate evaluation of its corporate value by deepening understanding
through closer dialogues with various stakeholders regarding its position as a proprietary power semiconductor manufacturer aswell as its management policies and plans meant to maximize use of this position. In order to strengthen corporate governance,
the company has strengthened the supervisory function of the Board of Directors by electing independent External Directors
and by developing a flexible system for operational execution and enhanced management functions by adopting a Corporate
Officer system. In addition, in order to realize a management system able to promptly respond to changes in the management
environment, and to clarify the management responsibility of the Directors for the corresponding fiscal year, the Company’s
term of office for Directors is one year.
The Board of Directors believes that these measures improve the Company’s corporate value and decrease the likelihood that a
Large Purchase will significantly harm the common interests of the shareholders. Accordingly, these efforts are deemed to be incompliance with the Basic Policy, and are in the common interests of the shareholders.

2. Other Matters Concerning the Corporate Governance System
The status of the development of the Company’s internal system for timely disclosure of corporate information is as follows:(1) Internal System for Timely Disclosure of Corporate Information
The Board of Directors and the Management Committee determine material matters in the management of the Company and its
group companies and receive reports on material corporate information. Whether a piece of information submitted to thesebodies (hereinafter referred to as “management information”) is subject to timely disclosure is determined by the Legal
Department according to the instructions of Head of Corporate Design Headquarters, who is the officer charged withinformation handling. The Legal Department receives reports from and has discussions with each department about
management information in advance, examines proposals to be submitted to the Board of Directors, and implements othermeasures to gather information. If the Legal Department determines that the information is subject to timely disclosure underlaws, regulations, and rules, the Company discloses the information via TDnet immediately, provided that information about
decisions and financial results is disclosed after approval by these decision-making bodies and that information about facts
which occurred is disclosed after their occurrence. The Investor Relations Department is responsible for responding tostakeholders, such as media and investors, and for information disclosure on the Company’s website.
(2) Oversight Functions of the Internal System for Timely Disclosure
In order to strengthen its internal control, the Group has established the Internal Audit Office and formulated the “Conduct
Guideline” as a guideline for compliance with ethics laws and regulations, which stipulates appropriate disclosure of corporate
information. In addition, the Group operates its “whistle-blowing protocol (Helpline System)” whereby if an employee shouldfind that any illegal or prohibited act has been committed or may be committed in the Group, the employee can report it for
whistle-blowing via third-party institutions. In terms of internal information management, the Company has formulated the“Regulations on Information Management” and the “Regulations on Insider Trading Management,” which provide for the
regulations on the management of internal information and the guideline regarding information management, and is working tostrengthen its information management system.

25

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Reference: The Company’s Internal System for Timely Disclosure• Decisions• Financial results
information• Facts which
occurred

The Company’s departments and group companies

Report anddiscussion

Examination andinformation gathering

Report anddiscussion

The Legal Department determines whether the information
is subject to timely disclosure
ReportReportApproval by the officer charged with information handling(Head of Corporate Design Headquarters)
ReportReportApproval by President and Representative Director

Submission

Resolution by the Board of Directors

Publication

Publication

Publication• The Legal Department: Transmission via TDnet• The IR Department: Contact regarding public announcements27