SECOND PARTY OPINIONKIRIN HOLDINGS COMPANY, LIMITED.
KIRIN SOCIAL BOND

Prepared by: DNV Business Assurance Japan K.K.
Location: Kobe, Japan
Date: 22 September 2023
Ref. Nr.: PRJN-608685-2023-AST-JPN-01

Page 1 of 29

Executive Summary
Kirin Holdings Company, Limited (hereinafter, Kirin Holdings) is the holding company of the Kirin
Group consisting of Kirin Brewery Company, Limited, Kirin Beverage Company, Limited, Lion Pty Ltd,
Kyowa Kirin Co., Ltd., Mercian Corporation, Coca-Cola Beverages Northeast, Inc., Kyowa Hakko BioCo., Ltd., etc. Based on fermentation and biotechnology cultivated since its foundation, Kirin expanded
into the Food domain (alcoholic & beverages business), the Pharma domain (pharmaceuticalbusiness), as well as the Health Science domain (health science business), an intermediate domain
between the two, with its operations mainly in Japan, Asia, and Oceania.
Since issuing a Green Bond in 2020, Kirin Holdings has been actively involved in resolving
environmental and social issues using ESG Finance by implementing a Social Bond (2022) and two
Transition Link Loans (both in 2023).
Kirin Holdings is aiming at "becoming a global leader in CSV by creating value in domains ranging
from food & beverages to pharmaceuticals" under its long-term management vision, "Kirin Group
Vision 2027 (KV2027)." Moreover, Kirin Holdings considers taking a CSV (Creating Shared Value)
approach, which make the resolution of social issues an integral part of its business operations, as oneof the most productive ways for a company to achieve sustained growth and address social issues.
Therefore, Kirin Holdings places CSV at the core of its business management to make a difference insociety and achieve sustainable mutual growth. "CSV Purpose" has been formulated as one of thelong-term non-financial goals of "Kirin Group Vision 2027 (KV2027)." "CSV Purpose" is the Kirin
Group's guiding principle to achieve sustainable growth and create value together with people acrosssociety. In order to raise proceeds that are necessary for addressing social issues with regard to"health" defined in "CSV Purpose" through Social Bond, Kirin Holdings formulated "Kirin Social Bond
Framework" (hereinafter, the Framework).
Kirin Holdings has commissioned DNV Business Assurance Japan K.K. (hereinafter, DNV) to conduct
the pre-issuance assessment on Kirin Social Bond, which will be implemented based on the "Kirin
Social Bond Framework." DNV, as an external reviewer, referred to or applied the four core elements
defined in the following social bond principles and guidelines that are currently widely recognized by
the capital markets, and evaluated the eligibility of Kirin Social Bond.
-

Social Bond Principles (ICMA/2023; hereinafter, SBP)-

Social Bond Guidelines (Financial Services Agency/2021; hereinafter, SBGLs)

The summary of the assessment is as follows:
Principle 1. Use of Proceeds:
DNV confirmed that the proceeds from Kirin Social Bond will be allocated to new investments andrefinancing of social projects in the table below outlined in SBP/SBGLs. See the table below and
Schedule-1 for overview of eligible social projects. Specifically, it is the acquisition of shares inBlackmores Limited (hereinafter, Blackmores) to enable Kirin Holdings to create further economic
and social value by solving more health issues for people worldwide. The full amount of the social
bond proceeds will be allocated to a portion of the acquisition price, which will be estimated andset as the amount available for allocation by dividing proportionally the sales of businesssegments and products that match SBP/SBGLs. DNV confirmed that the social bond proceeds will
be used as part of the acquisition of Blackmores, as the amount estimated by Kirin Holdings to beavailable for allocation is well in excess of the amount of proceeds.

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Principle 2. Process for Project Evaluation and Selection:
For the evaluation and selection of eligible social projects, DNV confirmed that Kirin Finance
Department and CSV Strategy Department will select the projects that meet the eligible criteria
defined by the Framework, and the Executive Officer in charge of Financial Strategy will make thefinal decisions on the selected eligible projects. In addition, DNV also confirmed that Kirin
Holdings evaluated the eligibility of the projects comprehensively based on the contribution to theachievement of "CSV Purpose."
The projects evaluated and selected through the above process are closely related to social issues
such as "Improvement of access to nutrition," "Ensuring food safety and security," and "Support
for maintaining the immune system" out of the key issues outlined in "Management Issues for
Sustainable Growth (the Kirin Group Materiality Matrix (GMM)" in addition to Kirin Holdings' "CSV
Purpose," and are consistent with the Kirin Group's efforts related to social sustainability. DNV
also confirmed that Kirin Holdings has identified risks specific to eligible projects through various
due diligence and has implemented appropriate responses and procedures.
Principle 3. Management of Proceeds:
DNV confirmed that Kirin Holdings plans to fully allocate the proceeds to new investments andrefinancing of eligible projects immediately after the issuance.
DNV also confirmed that Kirin Finance Department will manage the allocation status of theproceeds using the internal management system until the full amount of the proceeds isredeemed.
Principle 4. Reporting:
DNV confirmed that Kirin Holdings will publish the allocation status (allocated and unallocatedamount) of the proceeds of Kirin Social Bond on its website on an annual basis until the fullamount of the proceeds has been allocated. In terms of the social benefits, Kirin Holdings plans toreport on the indices specified for eligible projects until the full amount of the proceeds isredeemed. If any significant event, such as a major change in plans or actual results, occurs after
full allocation of the proceeds, Kirin Holdings will disclose such information in a timely manner.
The reporting will be disclosed on the Kirin Holdings website.
Based on the Framework and other relevant documents and information provided by Kirin Holdings, DNV
confirmed that Kirin Social Bond meets the relevant criteria and will be planned and implemented
properly.

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Table Summary of Social Projects
Social Projects Categories№

1

Business

Sub-categories of

Segments

Business Segments

Access to- Health, health careessential
services- Physical, social andFood security

economic access toand sustainable

safe, nutritious andfood systems

sufficient food that

Social Projects
Social Projects
Overview

TargetPopulation

Contribu
Social Benefits

Acquisition of shares General public "Raise the number
in Blackmores
People whoof healthy people,
require specific lower the number
nutrients due of sick people, andto illness
contribute to thepeople who are
involved inhealthcare," andcontribute to solve
more healthchallenges forpeople all over theworldmeets dietaryneeds andrequirements- Improvement of
eating habits andmanagement of
pre-symptomatic
diseasePage 4 of 29

Social Issues

tion toSDGs• Achievementof health andlongevity• Response toa super-aging
society• From"treatment"to"prevention"(managemen
t of presymptomatic
disease )Contents
Executive Summary

2

I. Introduction

6

Ⅱ. Scope and Objectives

12

Ⅲ. Responsibilities of Kirin Holdings and DNV

13Ⅳ. Basis of DNV’s Opinion

14

V. Work Undertaken

15

Ⅵ. Findings and DNV's Opinion

16

Ⅶ. Assessment Conclusion

23

Schedule-1 Kirin Social Bond Nominated Projects

24

Schedule-2 Social Bond Eligibility Assessment Protocol

25

Revision History
RevisionNo.
0Date of Issue
22 September 2023

Remarks
InitialDisclaimer
Our assessment relies on the premise that the data and information provided by Issuer to us as part of our review procedures have been provided in good faith.
Because of the selected nature (sampling) and other inherent limitation of both procedures and systems of internal control, there remains the unavoidable risk thaterrors or irregularities, possibly significant, may not have been detected. Limited depth of evidence gathering including inquiry and analytical procedures and limited
sampling at lower levels in the organization were applied as per scope of work. DNV expressly disclaims any liability or co-responsibility for any decision a person or anentity may make based on this Statement.

Statement of Competence and Independence
DNV applies its own management standards and compliance policies for quality control, in accordance with ISO/IEC 17021:2011 - Conformity Assessment Requirements
for bodies providing audit and certification of management systems, and accordingly maintains a comprehensive system of quality control, including documented
policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements. We have compliedwith the DNV Code of Conduct1 during the assessment and maintain independence where required by relevant ethical requirements. This engagement work was carriedout by an independent team of sustainability assurance professionals. DNV was not involved in the preparation of statements or data included in the Framework except
for this Statement. DNV maintains complete impartiality toward stakeholders interviewed during the assessment process.

1 DNV Code of Conduct is available from DNV website (www.DNV.com)

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I. Introductioni.

About the Issuer
Kirin Holdings is the holding company of Kirin Group consisting of Kirin Brewery
Company, Limited, Kirin Beverage Company, Limited, Lion Pty Ltd, Kyowa Kirin Co.,
Ltd., Mercian Corporation, Coca-Cola Beverages Northeast, Inc., Kyowa Hakko Bio Co.,
Ltd., etc. Based on fermentation and biotechnology cultivated since its foundation,
Kirin Holdings expanded into the Food domain (alcoholic & beverages business), thePharma domain (pharmaceutical business) and the Health Science domain (healthscience business), an intermediate domain between the two, with its operation mainly
in Japan, Asia and Oceania.
Kirin Group sets "KIRIN brings joy to society by crafting food and healthcare products
inspired by the blessings of nature and the insights of our customers" as its corporate
philosophy.

ii.

Issuer's ESG/SDGs Initiatives
Kirin Holdings is aiming at "becoming a global leader in CSV by creating value indomains ranging from food & beverages to pharmaceuticals" under its long-term
management vision, "Kirin Group Vision 2027 (KV2027)." Moreover, Kirin Holdings
considers taking a CSV (Creating Shared Value) approach, which make the resolution ofsocial issues an integral part of its business operations, as one of the most productive
ways for a company to achieve sustained growth and address social issues. Therefore,
Kirin Holdings places CSV at the core of its business management to make a differencein society and achieve sustainable mutual growth.
"CSV Purpose" has been formulated as one of the long-term non-financial goals of "Kirin
Group Vision 2027 (KV2027)," and the Kirin Group's guiding principle to achievesustainable growth and create value together with people across society. The Kirin
Group is committed to playing its role as a responsible alcohol producer and addressing
three key social issues: "health and well-being," "community engagement," and "theenvironment." By fulfilling these commitments, the Group brings joy to society and abright future to our customers. (See Figure -1)
For formulating the "CSV Purpose," Kirin Group has formulated its "Management Issues
for Sustainable Growth" in Kirin Group Materiality Matrix (GMM) as part of its
commitment to sustainable development in partnership with society. (See Figure-2)
Selection criteria for each management issue have been established for the selection ofmaterialities. (See "Procedure to select Materiality" on the Kirin Holdings website.) Kirin
Group has also established "CSV Commitment" as a medium-term action plan to achieve
its "CSV Purpose" and incorporated it into the business plans of the Group and key
business companies. (See "Commitments and Performance Indicators" on the Kirin
Holdings website.)

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Figure-1 "CSV Purpose" of Kirin Group

Figure-1 Management Issues for Sustainable Growth (Group Materiality Matrix)

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iii. Issuer's Initiative to Environmental and Social Issues
The Kirin Group has revised its existing environmental vision in February 2020 andformulated a new one, "Kirin Group's Environmental Vision 2050," a long-term
strategy looking ahead to 2050, with the aim of spearheading the efforts to tackle
environmental issues. One of the Kirin Group's initiatives to address environmental
issues is overcoming climate change, and Kirin Group has declared to achieve Net-Zero
GHG emissions across its entire value chain by fiscal 2050 and switch 100% of its
electricity consumption to renewables by fiscal 2040. In December 2020, Kirin Group
became the first food company in Japan that obtained an approval of the SBT 1.5°C
target, a science-based goal of the SBT Initiative (SBTi).
In 2019, Kirin Holdings established the "Kirin Group Plastic Policy," an effort aimed atsolving the global plastic waste problem, and declared to increase the percentage of
PET bottles made using recycled resin to 50% of bottles sold in Japan by fiscal 2027.
In "Kirin Group Environmental Vision 2050," Kirin Group will work on to achieve 100%
sustainable containers and packaging made from recycled materials and biomass by
2050.

The Kirin Group has identified "Health and Well-being" as one of the key issues within"CSV Purpose." It has determined "immunity," "brain function" and the "gutmicrobiome" as its three key areas and is endeavouring to solve health issues in theseareas through providing products and services that use strategic ingredients produced
by utilizing fermentation & biotechnology, the Kirin Group's core competencies.
Specifically, Kirin Group addresses the improvement of access to nutrition, support tobrain function improvement and brain function decline prevention, and themaintenance of immune function. Human Milk Oligosaccharide (HMO), a uniquenutrient of human breast milk, was successfully mass-produced by the Kirin Group's
fermentation production technology utilizing microorganisms. β-Lactolin (Citicoline) is a
proprietary ingredient derived from Kirin Group's brain research that supports themaintenance of memory, which declines with age. The world's first Lc-PLASMA
activates pDC (Plasmacytoid dendritic cells), the command centre of immune cells. By
providing such highly functional products as the result of various research andPage 8 of 29

development efforts, the Kirin Group contributes to solving social and health issues inJapan and around the world.

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iv. About "Kirin Social Bond Framework"
In order to raise proceeds that are necessary for addressing social issues with regard
to "health" defined in "CSV Purpose" through Social Bond, Kirin Holdings formulated
the Framework. The standards and guidelines being referred to in the Framework aredescribed in Section II (3) below.
Net proceeds from the Social Bond are expected to be allocated to each category of thefollowing social projects and will be managed and executed in accordance with theestablished Framework.

[Social Projects]
Acquisition of shares in Blackmores
The contribution to social issues through the acquisition of shares in Blackmores is
an initiative that falls into the following business categories.
• Access to essential services- Health, health care
• Food security and sustainable food systems- Physical, social and economic access to safe, nutritious and sufficient food thatmeets dietary needs and requirements- Improvement of eating habits and management of pre-symptomatic diseasev.

Overview of Blackmores
Blackmores, founded in 1932, is Australia's largest and oldest natural health company.
With Blackmores' stated purpose to "Give people a choice to make living well each day
a natural way of life" and mission to "Combine our knowledge of nature and science todeliver quality solutions to bring wellness to people and their pets everywhere,
everyday," Blackmores has contributed to the health of people in Asia-Pacific for nearlya century through research and development of natural health built on the principles ofnaturopathy.
Blackmores' key products and brands include; "Blackmores" (supplements and infantmilk formula), "BioCeuticals" (supplements for practitioners*1) and "PAW by
Blackmores" (supplements for pets) which are sold in markets in the Asia-Pacificregion.
Blackmores has a strong presence and trust from consumers in Malaysia, Thailand,
Indonesia, Vietnam and Singapore, having first expanded into Southeast Asia in 1976.
Blackmores has a strong position as a foreign-affiliated nutritional supplementcompany in China, having entered the market in 2013. In recent years, Blackmores
has also been actively expanding into new markets such as India.

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In recognition of their long history and high awareness of quality, Blackmores has been
awarded the "Most Trusted Brand"*2 in vitamins and supplements in Australia for 14
consecutive years.
*1. Supplements that can only be sold by qualified practitioners (e.g., pharmacists, doctors)*2. Reader’s Digest’s Annual Trusted Brands Awards celebrates the brands Australians trust the most.
Results - Trusted Brands Australia 2023

vi. Synergies in the Acquisition of Blackmores
The acquisition of shares in Blackmores is expected to help Kirin Holdings andBlackmores create a wide range of synergies in the business areas in which they
operate, as shown in (i) to (iii) below, thereby contributing to solving many healthrelated social issues.
(i) Transform the scale of the Health Science business, expand its product range andcapabilities and broaden its geographic profile and growth opportunities.
(ii) Realize continuous growth of the Health Science business through the evolution of
the B2B and B2C businesses that further enhances the ability to propose solutions
by utilizing access of Kirin Holdings' specialty ingredients to hundreds of millions ofconsumers in the Asia-Pacific region through Blackmore's distribution network andits knowledge of consumer demands and deep understanding of country-specificregulations.
(iii) New product development through the use of technologies from both companies.

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Ⅱ. Scope and Objectives
Kirin Holdings has commissioned DNV to conduct a pre-issuance assessment of Kirin
Social Bond, which is issued based on the Framework. The objective of the pre-issuanceassessment of DNV is to conduct an assessment to confirm that Kirin Social Bond meets
SBP/SBGLs described below, and to provide a second party opinion on its eligibility.
DNV, as an independent external reviewer, identified no real or perceived conflict ofinterest associated with the delivery of this second-party opinion for Kirin Holdings. In thispaper, no assurance is provided regarding the financial performance of Kirin Social Bond
to be executed based on the Framework, the value of any investments, or the long-termsocial benefits of the transaction.
(1) Scope of review*1
The review assessed the following elements and confirmed their alignment with four core elements such as SBP.
☒

Use of Proceeds☒

Process for Project Evaluation and Selection☒

Management of Proceeds☒

Reporting(2) Role(s) of review provider☒

Second Party Opinion☐

Certification☐

Verification☐

Rating☐Other (please specify):(3) Standards/guidelines to be applied
No.

Standards/guidelines

Scheme owner

Applied level*1

1.

Social Bond Principles 2023 (SBP)

International Capital Market Association(ICMA), 2023

Apply

2.

Social Bond Guidelines 2021 (SBGLs)

Financial Services Agency, 2021

Apply

*1. Apply: Eligibility for all four core common elements to each principle or guideline was assessed.

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Ⅲ. Responsibilities of Kirin Holdings and DNVKirin Holdings has provided the information and data used by DNV during the delivery of thisreview. DNV's second party opinion represents an independent opinion and is intended to
inform Kirin Holdings and other interested stakeholders in Kirin Social Bond as to whether theestablished criteria have been met, based on the information provided to us. In our work, wehave relied on the information and the facts presented to us by Kirin Holdings. DNV is not
responsible for any aspect of the nominated activities referred to in this opinion and cannot
be held liable if estimates, findings, opinions, or conclusions are incorrect based on theinformation and facts provided by Kirin Holdings. Thus, DNV shall not be held liable if any of
the information or data provided by Kirin Holdings and used as a basis for this assessment
were not correct or complete.

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Ⅳ. Basis of DNV’s Opinion
To provide as much flexibility as possible for the issuer, Kirin Holdings, DNV has adapted ourSocial Bond assessment methodology, which incorporates the requirements of SBP/SBGLs, tocreate an Eligibility Assessment Protocol (hereinafter, DNV's Protocol). Please refer to
Schedule-2. The Protocol is applicable to Social Bond under SBP/SBGLs.
DNV provides second party opinion as an independent external reviewer based on theassessment utilizing this Protocol. DNV's Protocol includes a set of suitable criteria that can beused to underpin DNV's opinion. The overarching principle behind the criteria is that a social
bond should "enable capital-raising and investment for new and existing projects with social
benefits." As per our Protocol, the criteria against which Kirin Social Bond has been reviewed
are grouped under the four Principles outlined in SBP:
Principle 1: Use of Proceeds
The Use of Proceeds criteria are guided by the requirement that an issuer of asocial bond must use the funds raised to eligible activities. The eligible activities
should produce clear social benefits.
Principle 2: Process for Project Evaluation and Selection
The Process for Project Evaluation and Selection criteria are guided by therequirements that an issuer of a social bond should outline the process it follows
when determining eligibility of an investment using Social Bond proceeds andoutline any impact objectives it will consider.
Principle 3: Management of Proceeds
The Management of Proceeds criteria are guided by the requirements that a social
bond should be tracked within the issuing organization, that separate portfolios
should be created when necessary and that a declaration of how unallocated funds
will be handled should be made.
Principle 4: Reporting
The Reporting criteria are guided by the recommendation that at least
Sustainability Reporting to the Social Bond investors should be made of the use ofbond proceeds and that quantitative and/or qualitative performance indicators
should be used, where feasible.

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V. Work Undertaken
Our work constituted a high-level review of the available information, based on theunderstanding that this information was provided to us by the issuer in good faith. We
have not performed an audit or other tests to check the veracity of the information
provided to us during the assessment before issuance. The work undertaken to form ouropinion included:i. Pre-Issuance Assessment•

Creation of the issuer's specific Protocol, adapted to the purpose of Kirin Social Bond,
as described above and in Schedule-2 to this assessment.

•

Assessment of documentary evidence provided by the issuer on Kirin Social Bond andsupplemented by a high-level desktop research. These checks refer to current
assessment best practices and standards methodology.

•

Discussions with the issuer, and review of relevant documentation.

•

Documentation of findings against each element of the criteria.

ii. Post-Issuance Assessment (*not included in this report）•

Assessment of evidential documents provided by Kirin Holdings after issuance of Kirin
Social Bond, and supplemental assessment by desk review from a higher perspective.

•

Interview with key personnel of the issuer, and review the relevant documentation.

•

Field research and inspection (if necessary).

•

Review of the nominated projects and assets at the time of the post-issuance verification(update of the details mentioned in Schedule-1).

•

Document creation of post-issuance assessment result.

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Ⅵ. Findings and DNV's Opinion
DNV's findings and opinion against the four core elements outlined in SBP/SBGLs are listed in(1) to (4) below.
(1) Use of Proceeds
DNV confirmed that the proceeds from Kirin Social Bond will be allocated to the following
eligible projects (Table-2) outlined in SBP/SBGLs. Specifically, it is the acquisition ofshares in Blackmores to enable Kirin Holdings to create further economic and social value
by solving more health issues for people worldwide.
The full amount of the social bond proceeds will be allocated to a portion of theacquisition price, which will be estimated and set as the amount available for allocation by
dividing proportionally the sales of business segments and products that match
SBP/SBGLs.
DNV confirmed that the social bond proceeds will be used as part of the acquisition ofBlackmores, as the amount estimated by Kirin Holdings to be available for allocation iswell in excess of the amount of proceeds.

Table-2 Social projects (See Schedule-1 for details)
Social Projects Categories№

1

Business

Sub-categories of

Segments

Business Segments

Access to- Health, health careessential
services- Physical, social andFood security

economic access toand sustainable

safe, nutritious andfood systems

sufficient food that

Social Projects
Social Projects
Overview

TargetPopulation

Contribu
Social Benefits

Acquisition of shares General public “Raise the number
in Blackmores
People whoof healthy people,
require specific lower the number
nutrients due of sick people, andto illness
contribute to thepeople who are
involved inhealthcare,” andcontribute to solve
more healthchallenges forpeople all over theworldmeets dietaryneeds andrequirements- Improvement of
eating habits andmanagement of
pre-symptomatic
diseasePage 16 of 29

Social Issues

tion toSDGs• Achievementof health andlongevity• Response toa super-aging
society• From“treatment”
to“prevention”(managemen
t of presymptomatic
disease)Overview of products handled by Blackmores
Blackmores is a leading natural health company in Australia and China/Southeast Asia, withsales channels covering the Asia-Pacific region, developing products to help solve people's
health challenges.
The company has three brands (see Figure-3), "Blackmores" (supplements and infant milk
formula), "BioCeuticals" (supplements for practitioners*1) and "PAW by Blackmores"(supplements for pets). The majority of the products are TGA certified*2 in Australia.
*1. Supplements that can only be sold by qualified practitioners (e.g., pharmacists, doctors)*2. TGA (Therapeutic Goods Administration) is a part of the Department of Health and Aged Care. TGA
certification is a unique regulation of the production process, established by the AustralianGovernment in 1989 to ensure the quality of products with curative properties. Even after
accreditation, strict standards are always in place, including unannounced inspections.

Figure-3 Blackmores product range(Source: Kirin Holdings investor briefing material on the acquisition of Blackmores)

Relevance of using the proceeds to acquisitions
Mergers and acquisitions are an example of an appropriate expenditure under international
ESG finance standards, which allow for the part of the expenditure that corresponds tosome market value to be considered as an appropriate expenditure, and Kirin Holdings has
adopted this approach.
Kirin Holdings plans to allocate the social bond proceeds to a portion of the amountavailable for allocation, which is calculated by dividing proportionally the sales of all
products by the sales of Blackmores' business segments and major product categories thatmatch SBP/SBGLs.
Through its review, DNV has concluded that it is reasonable that the full amount of social
bond proceeds will be used as part of the acquisition of Blackmores, as the Kirin Holdings'

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evaluation process is appropriate and the amount estimated by Kirin Holdings to beavailable for allocation is well in excess of the amount of proceeds.

Use of Proceeds Categories as per SBP:☐

Affordable basic infrastructure☒

Access to essential services☐

Affordable housing☐

Employment generation (SME financing and☒Food security and sustainable food☐Socio-economic advancement and empowerment☐

Other (please specify):

microfinance)systems☐

Areas that are considered to meet the
SBP classification or are not listed in the
SBP but are eligible

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(2) Process for Project Evaluation and Selection
For the evaluation and selection of eligible projects of Kirin Social Bond, DNV confirmed
through the review that the Executive Officer in charge of Financial Strategy will make thefinal decisions on the selected eligible projects after discussion by Kirin Finance
Department and CSV Strategy Department. In addition, DNV also confirmed that theeligibility of the projects was evaluated comprehensively based on their contribution to
the achievement of "CSV Purpose."
The projects evaluated and selected through the above process are closely related tosocial issues such as "Improvement of access to nutrition," "Ensuring food safety andsecurity," and "Support for maintaining the immune system" out of the key issues
outlined in "Management Issues for Sustainable Growth (the Kirin Group Materiality Matrix(GMM)" in addition to Kirin Holdings' "CSV Purpose," and are consistent with the Kirin
Group's efforts related to social sustainability.
In selecting projects, DNV confirmed that the issuer meets the eligibility criteria as
indicated in "II. Scope and Objectives (3) Standards/guidelines to be applied," and that it
will comply with environmental laws and regulations and agreements with the relevant
communities, as well as with the Kirin Group Compliance Guidelines in order to act withintegrity and in conformity with social ethics. Kirin Holdings will appropriately address anddisclose any ESG-related controversy that may arise regarding eligible projects.
DNV also confirmed that Kirin Holdings has identified risks specific to eligible projects
through various due diligence and has implemented appropriate responses andprocedures.

Evaluation and Selection☒

Conforms to the issuer’s achievement of☒social contribution goals☒☒

Documented process to determine thatprojects fit within defined categories

The project is eligible for use of proceeds☒

Documented process to identify and manage

by Social Bond and transparency ispotential ESG risks associated with theensured.

project

The project is evaluated and selected☐

Other (please specify):

based on the published standard
summary

Information on Responsibilities and Accountability☒

Evaluation/selection criteria subject to☒In-house assessment

external advice or verification☐

Other (please specify):

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(3) Management of Proceeds
DNV confirmed how Kirin Holdings will track and manage the proceeds during the period
from the execution of Kirin Social Bond to the redemption. DNV also confirmed that Kirin
Holdings plans to fully allocate the proceeds to new investments and refinancing of
eligible projects immediately after the issuance.
DNV also confirmed that Kirin Finance Department will manage the allocation status of
the proceeds using the internal management system until the full amount of the proceeds
is redeemed.

Tracking of Proceeds:☒

Some or all of the proceeds by Social Bond that are planned to be allocated are systematicallydistinguished or tracked by the issuer.

☐

Disclosure of intended types of temporary investment instruments for unallocated proceeds☒

Other (please specify): The unallocated proceeds will be managed in cash or cash equivalents.

Additional Disclosure:☐

Allocations to new investments only☒☒

Allocation to individual disbursements☐

Allocation to portfolio disbursements☐

Disclosure of portfolio balance of☐

Other (please specify):

Allocations to both existing and newinvestments

unallocated proceeds

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(4) Reporting
DNV confirmed that Kirin Holdings will publish the allocation status (allocated andunallocated amount) of the proceeds of Kirin Social Bond on its website on an annual
basis until the full amount of the proceeds has been allocated. The first reporting will be
published in the year following the issuance. If any significant event, such as a majorchange, occurs after full allocation of the proceeds, Kirin Holdings will disclose suchinformation in a timely manner.
<Allocation of Proceeds>

Eligible projects for allocation and the amount of allocated proceedsManagement methods and the balance of unallocated proceeds<Social Benefits>
The reporting indicators currently assumed by Kirin Holdings are as stated in the tablebelow. Depending on the future business development with Blackmores, Kirin Holdings
plans to report on its initiatives to the extent practicable.
Eligible ProjectOutputOutcome

ImpactAcquisition of shares

Making Blackmores as ‒ Improved access to products"Raise the number of healthyin Blackmores

a subsidiary

people, lower the number of sickhandled by Blackmores

people, and contribute to thepeople who are involved inhealthcare," and contribute to solve
more health challenges for people
all over the world

Use of Proceeds Reporting:☒

Project-by-project☐

On a project portfolio basis☐

Linkage to individual bond(s)☐Other (please specify):☒

Social bond allocated share of total investment

Information Reported:☒

Allocated amounts☐

Other (please specify):

Frequency:☒

Annual (until allocations are completed)☐

Other (please specify):☐

Semi-annual

Impact Reporting (Social Benefits):☒

Project-by-project☐

On a project portfolio basis

Page 21 of 29

☐Linkage to individual bond(s)☐Other (please specify):

Frequency:☒

Annual☐Other (please specify):☐

Semi-annual

Information Reported (Expected or Post-Issuance):☐

Number of continuous users☒of the product

Other ESG evaluation item (please specify):
Sales and social project relevant
performance data for products handled byBlackmores

Means of Disclosure:☐

Information published in financial report☐

Described in sustainability report☒

Other (please specify): Disclosing on website(Integrated Report)☐

Information published in ad hoc documents☐

Reporting reviewed (if yes, please specify which parts of the reporting are subject to external
review):

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Ⅶ. Assessment Conclusion
On the basis of the information provided by Kirin Holdings and the work undertaken, it
is DNV's opinion that Kirin Social Bond conducted by Kirin Holdings meets the criteria
established in the Protocol and is aligned with the stated definition or purpose of social
bond within SBP/SBGLs, which is to "enable capital-raising and investment for new andexisting projects with social benefits."

DNV Business Assurance Japan K.K.
22 September 2023

Thomas Leonard

Naoki Maeda

Head of Section, Sustainability Services

Managing Director

Supply Chain & Product Assurance

DNV Business Assurance Japan K.K.

DNV Australia, New Zealand and Southeast Asia

Masato Kanedome

Akira Tsukasaki

Project Leader

Assessor

DNV Business Assurance Japan K.K.

DNV Business Assurance Japan K.K.

About DNV
Driven by our purpose of safeguarding life, property and the environment, DNV enables organisations to advance thesafety and sustainability of their business. Combining leading technical and operational expertise, risk methodology andin-depth industry knowledge, we empower our customers’ decisions and actions with trust and confidence. We
continuously invest in research and collaborative innovation to provide customers and society with operational andtechnological foresight.
With our origins stretching back to 1864, our reach today is global. Operating in more than 100 countries, our 16,000
professionals are dedicated to helping customers make the world safer, smarter and greener.

Disclaimer
Responsibilities of the Management of the Issuer and the Second-Party Opinion Providers, DNV: The management ofIssuer has provided the information and data used by DNV during the delivery of this review. Our statement represents
an independent opinion and is intended to inform the Issuer management and other interested stakeholders in the Bond
as to whether the established criteria have been met, based on the information provided to us. In our work we haverelied on the information and the facts presented to us by the Issuer. DNV is not responsible for any aspect of thenominated assets referred to in this opinion and cannot be held liable if estimates, findings, opinions, or conclusions areincorrect. Thus, DNV shall not be held liable if any of the information or data provided by the Issuer’s management andused as a basis for this assessment were not correct or complete.

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Schedule-1 Kirin Social Bond Nominated Projects
The nominated projects listed in the table are Kirin Social Bond candidates evaluated for eligibility at the time of pre-issuance eligibility assessment (as of September 2023).
The social project classification is the representative example shown in SBP/SBGLs. In the future, Kirin Social Bond executed under the Kirin Social Bond Framework, thefollowing social projects will be selected as eligible projects. If the additional social projects are included, the issuer will evaluate the eligibility in advance. If necessary, DNV
will conduct the evaluation in a timely manner.
Social Projects Categories№

1

Business Segments

Sub-categories ofBusiness Segments

Access to essential services- Health, health care

Food security and- Physical, social andsustainable food systems

economic access to safe,

Social Projects
Social Projects
Overview

Target Population

Acquisition of shares General publicin Blackmores
People who require
specific nutrients due
to illness

nutritious and sufficient
food that meets dietaryneeds and requirements- Improvement of eating
habits and management of
pre-symptomatic disease

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Social Benefits

Social Issues“Raise the number of healthy• Achievement of healthpeople, lower the number ofand longevity
sick people, and contribute to• Response to a superthe people who are involved inaging society
healthcare,” and contribute to• From “treatment” tosolve more health challenges for“prevention”
people all over the world(management of presymptomatic disease)

Contribution
to SDGs

Schedule-2 Social Bond Eligibility Assessment Protocol
The following SBP-1 ~ SBP-4 are DNV's Eligibility Assessment Protocol created for Kirin Social Bond based on the requirements of SBP (2023). The "Confirmed
documents" in the work undertaken includes internal documents of the issuer and are provided by Kirin Holdings as evidence of eligibility judgement for DNV.

SBP-1 Use of Proceeds
Ref.

Criteria

Requirements

Work Undertaken

1aType of bond

The bond must fall in one of the following
categories:•(Standard) Social Bond•
Social Revenue Bond•
Social Project Bond•
Other

Confirmed Documents:
Through the evaluation process, DNV confirmed that Kirin Holdings'• Kirin Social Bond Frameworksocial bond falls into the following category:(hereinafter, Framework)• Social Bond pre-issuance(Standard) Social Bondeligibility assessment materials
Interviews with stakeholders

1bSocial Project
Categories

The cornerstone of a Social Bond is theutilization of the proceeds of the bondwhich should be appropriately describedin the legal documentation for the
security.

Confirmed Documents:
DNV confirmed that the full amount of the proceeds is planned to• Framework
be allocated to the following projects:• Social Bond pre-issuance"Access to essential services (health, health care)"eligibility assessment materials "Food security and sustainable food systems (physical, social and• Draft statutory disclosure
economic access to safe, nutritious and sufficient food that meets
document
dietary needs and requirements, improvement of eating habits andInterviews with stakeholders
management of pre-symptomatic disease)"

1cSocial benefits

All designated Social Project categories
should provide clear socially sustainable
benefits, which, where feasible, will bequantified or assessed by the issuer.

Confirmed Documents:• Framework• Social Bond eligibility
assessment materials
Interviews with stakeholders

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DNV Findings

DNV confirmed that the social project is a solution for the objective
social issue, that local characteristics are taken into account, andthat the target population and social contribution (outcome) of the
project are clearly identified by the issuer.
Specifically, DNV confirmed that the acquisition of Blackmores is
expected to help to solve more health challenges for people all over
the world, aiming to "raise the number of healthy people, lower thenumber of sick people, and contribute to the people who are
involved in healthcare," through improved access to Blackmores'
products, etc.

Ref.

Criteria

Requirements

Work Undertaken

DNV Findings

1dRefinancing
share

In the event that a proportion of theproceeds may be used for refinancing, it
is recommended that issuers provide anestimate of the share of financing vs.
refinancing, and where appropriate, also
clarify which investments or project
portfolios may be refinanced.

Confirmed Documents:• Framework• Social Bond eligibility
assessment materials
Interviews with stakeholders

DNV confirmed that the proceeds from the social bond are planned
to be allocated to new investments and refinancing of social
projects listed in Schedule-1.

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SBP-2 Process for Project Evaluation and Selection
Ref.

Criteria

Requirements

Work Undertaken

DNV Findings

2aInvestmentdecision
process

The issuer of a Social Bond should outline

Confirmed Documents:• Framework• Social Bond eligibility
assessment materials
Interviews with stakeholders

DNV confirmed that Kirin Finance Department and CSV Strategy
Department will select the projects that meet the eligible criteria
defined by the Framework, and the Executive Officer in charge ofFinancial Strategy will make the final decisions on the selected
eligible projects.
DNV confirmed that the issuer meets the eligibility criteria as
indicated in "II. Scope and Objectives (3) Standards/guidelines tobe applied," and that the negative impacts of the project
implementation were assessed and considered, and theenvironmental and social risks were identified in advance.

Confirmed Documents:• Framework• Social Bond eligibility
assessment materials
Interviews with stakeholders

DNV confirmed that Kirin Holdings' social projects are consistent
with Kirin Holdings' "CSV Purpose" and the long-term management
vision "Kirin Group Vision 2027 (KV2027)." In implementing the
projects, DNV confirmed that the compliance with environmentrelated laws, regulations, ordinances and agreements with therelevant communities was considered. With regard to risks specificto eligible projects, DNV confirmed that risk items were identified
through various due diligence and appropriate measures andprocedures were implemented. In addition, DNV confirmed thatthe social benefits of social projects have been clarified throughconfirmation of documents such as the Framework and interviews
with relevant stakeholders.

the decision-making process it follows todetermine the eligibility of projects using
Social Bond proceeds. This includes,
without limitation:• A process to determine how the
projects fit within the eligible Social
Projects categories identified in the
ICMA SBP 2020;• The criteria making the projects
eligible for using the Social Bond
proceeds;• The social sustainability objectives

2bIssuer’s
environmentand social
governanceframework

In addition to information disclosed by anissuer on its Social Bond process, criteria
and assurances, Social Bond investors
may also take into consideration thequality of the issuer’s overall framework
and performance regarding social
sustainability.

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SBP-3 Management of Proceeds
Ref.

Criteria

3a

Tracking
procedure

3b

Tracking
procedure

3c

Temporaryholdings

Requirements

Work Undertaken

DNV Findings

The net proceeds of Social Bonds shouldbe credited to a sub-account, moved to a
sub- portfolio or otherwise tracked by theissuer in an appropriate manner andattested to by a formal internal processthat will be linked to the issuer’s lending
and investment operations for Social
Projects.

Confirmed Documents:• Framework• Social Bond eligibility
assessment materials• Kirin Group Treasury Policy
Interviews with stakeholders

Through document review and interviews, DNV confirmed that thenet proceeds were traceable through Kirin Holdings' Kirin Group
Treasury Policy and internal control systems. DNV also confirmedthat the actual systems and related documents in use are verified
and that the management status of the proceeds can be proven on
this basis.

So long as the Social Bonds areoutstanding, the balance of the tracked
proceeds should be periodically reducedby amounts matching eligible social
investments or loan disbursements madeduring that period.

Confirmed Documents:• Framework• Social Bond eligibility
assessment materials• Kirin Group Treasury Policy
Interviews with stakeholders

DNV confirmed that Kirin Holdings plans to manage the allocation
status of proceeds on a semi-annual basis from the execution of
the social bond until redemption.

Pending such investments orConfirmed Documents:
disbursements to eligible Social Projects, • Framework
the issuer should make known to• Social Bond eligibility
investors the intended types of temporary assessment materials
investment instruments for the balance of • Kirin Group Treasury Policy
unallocated proceeds.
Interviews with stakeholders

Page 28 of 29

DNV confirmed through interviews that the balance of unallocatedproceeds is recognized sequentially through a confirmation process
via Kirin Holdings' internal management system, etc. and that thefull amount of proceeds is planned to be allocated immediately
after the issuance.

SBP-4 Reporting
Ref.

Criteria

4aPeriodical
reporting

Requirements

Work Undertaken

DNV Findings

In addition to reporting on the use ofproceeds and the temporary investmentof unallocated proceeds, issuers should
provide at least annually a list of projects
to which Social Bond proceeds have been
allocated including - when possible withregards to confidentiality and/or
competitive considerations - a brief
description of the projects and theamounts disbursed, as well as the
expected socially sustainable impact.

Confirmed Documents:• Framework• Social Bond eligibility
assessment materials
Interviews with stakeholders

DNV confirmed that Kirin Holdings will publish the allocation status(allocated and unallocated amount) of the proceeds of Kirin Social
Bond on its website on an annual basis until the full amount of theproceeds has been allocated. DNV also confirmed that Kirin
Holdings will publish initial reporting in the year following theissuance, and that if any significant event, such as a major change,
occurs after full allocation of the proceeds, Kirin Holdings will
disclose such information in a timely manner.
(Social benefits)
DNV confirmed that Kirin Holdings currently assume following
reporting indicators. Depending on the future businessdevelopment with Blackmores, Kirin Holdings plans to report on its
initiatives to the extent practicable.
• Improved access to products handled by Blackmores (increased
number of areas distributed)

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