Oji Holdings Corporation Green Financing Framework Second Party Opinion

SECOND PARTY OPINION
OJI HOLDINGS CORPORATIONGREEN FINANCING FRAMEWORK

Prepared by: DNV Business Assurance Japan K.K.
Location: Kobe, Japan
Date: 24 January 2023
Ref. Nr: PRJN-403835-2022-AST-JPN-01

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

Contents
Executive Summary

3

I. Introduction

6

II.

Scope and Objectives

18

III.

Responsibilities of Oji and DNV

20

IV.

Basis of DNV’s Opinion

21

V.

Work Undertaken

22

VI.

Findings and DNV's opinion

23

Schedule-1 Green Financing Nominated Projects

32

Schedule-2 Green Financing Eligibility Assessment Protocol

33

Revision history
Revision
number0

Date of issue
24 January 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 that errors 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 an entity may makebased 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 forbodies providing audit and certification of management systems, and accordingly maintains a comprehensive system of quality control, including documented policies andprocedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements. We have complied with the DNV Codeof Conduct1 during the assessment and maintain independence where required by relevant ethical requirements. This engagement work was carried out 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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Oji Holdings Corporation Green Financing Framework Second Party Opinion

Executive Summary
Since its founding in 1873, the Oji Group, with Oji Holdings Corporation (hereinafter, “Oji”) as
its core, has continued to expand business fields. Today, the Group focuses on not only the
paper manufacturing business but also businesses that integrate materials and conversion,
such as the packaging and pulp businesses, the electric power generation business, including
renewable energy, hydroelectric and biomass power generation, and green innovation for the
future, such as the development of biomass plastics and cellulose nanofibers. As both thebusiness environment and the Oji Group itself experience substantial change, the Group is
striving to enhance its corporate value over the medium to long term based on its
management philosophy comprising “Creation of Innovative Values,” “Contribution to Future
and the World” and “Harmony with Nature and Society.”
The Oji Group has formulated "Environmental Vision 2050", which declares to achieve netzero carbon by 2050, and is considered to be in line with international scenarios such as theParis Agreement and the path towards achieving carbon neutrality in 2050, which is targetedin various policies in Japan.
As a milestone on the way to the "Environmental Vision 2050", the Oji Group has established"Environmental Action Program 2030", which sets a target of at least 70% reduction in GHG
emissions in FY2030 (compared to FY2018). This consists of reducing GHG emissions andincreasing the net CO2 absorption by forests owned by the Oji Group. The Group has createda roadmap for achieving its targets and has formed a project team to ensure theachievement. Oji is also continuing its efforts to contribute to the reduction of third-party
GHG emissions through the supply of renewable energy electricity, such as biomass andhydroelectric power. DNV Business Assurance Japan K.K. (hereinafter, "DNV"), as an external
reviewer, provided the assessment of the eligibility of Oji Holdings Corporation Green
Financing Framework. The projects to be implemented under the green finance intend to be
used to promote the above initiatives. Through the green finance, the Oji Group will reiterate
to its stakeholders, including investors, business partners, local communities, and employees,
its commitment to environmental management to achieve the decarbonized society it aims tocreate.
DNV provides the assessment of the eligibility of framework against Green Bond Principles(ICMA 2021, hereinafter, "GBP"), Green Bond Guidelines (Ministry of the Environment 2022,
hereinafter, "GBGLs"), Green Loan Principles (LMA et al. 2021, hereinafter, "GLP"), Green
Loan Guidelines (Ministry of the Environment 2022, hereinafter, "GLGLs") and, whereapplicable, the sector technical criteria of the Climate Bonds Standard (CBS v3.0, hereinafter,"CBS") and EU Taxonomy.

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

Assessment summary against 4 core components in GBP, GBGLs, GLP, and GLGLs arefollowing.

Principle 1. Use of Proceeds
Oji defines the use of raised proceeds as projects that fall into "Renewable Energy" and"Sustainable Forest Management". This applies to eligible green projects as articulated in
the GBP, GBGLs, GLP, and GLGLs. Specifically, it is planned that the proceeds will beallocated to new investments and refinancing related to the projects listed below.
(a) Renewable Energy: biomass (power generation, heat supply), solar energy,hydropower energy, onshore wind energy(b) Sustainable Forest Management: capital and operating expenditures relating toacquisition and conservation of production forests and conservation forests

Principle 2. Process for Project Evaluation and Selection
The green project will be used to promote initiatives such as the "Environmental Vision
2050", which declares to achieve "net-zero carbon" by FY2050, and the "Environmental
Action Program 2030", which establishes a target to reduce GHG emissions by 70%(compared to FY2018), as well as initiatives to help third parties reduce GHG emissions
through the supply of renewable energy electricity.
The Corporate Financial Division of Oji Management Office Inc. (hereinafter, “Oji MO”)
which is involved in management support of the Oji Group selects eligible projects after
evaluating their eligibility, in cooperation with the Group companies that manage theprojects and the Oji Holdings Corporate Sustainability Division that oversees and manages
Group environmental governance, and the Group CEO makes the final decision. If a projectis expected to have a serious negative impact on the environment or society, it will be
excluded from the eligible projects.

Principle 3. Management of Proceeds
All proceeds will be managed by the Corporate Financial Division of Oji MO using aninternal accounting system as well as dedicated ledgers, etc. in accordance with theprescribed cash management flow, and the allocation status will be monitored on an
ongoing basis. In the case of refinancing, only projects that have been disbursed within
three years of funding through green finance will be eligible for refinancing. Allocation
period will be within approximately two years of the financing. Unallocated funds will beheld as cash or cash equivalents.

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

Principle 4. Reporting
Until the proceeds are fully allocated, Oji will report the allocated and unallocated funds foreach eligible project (including the amount or percentage of new financing andrefinancing) on its website at least once a year. In addition, the environmental benefits will,to the extent practicable, be disclosed on the website at least once a year as long as thebalance of the proceeds remains available.

DNV confirmed the framework, related documents and information provided by Oji thatgreen finance meets relevant criteria then is supposed to be appropriately planned andexecuted.

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

I. Introductioni.

About the Fundraiser
Since its founding in 1873, the Oji Group has continued to grow in step with numerous
corporate mergers and the expansion of its fields of business. Today, the Group focuses on not
only the paper manufacturing business but also businesses that integrate materials andconversion, such as the packaging and pulp businesses, the electric power generation business,
including renewable energy, hydroelectric and biomass power generation, and green
innovation for the future, such as the development of biomass plastics and cellulose nanofibers.
As both the business environment and the Oji Group itself experience substantial change, theGroup is striving to enhance its corporate value over the medium to long term based on its
management philosophy comprising “Creation of Innovative Values,” “Contribution to Future
and the World” and “Harmony with Nature and Society.”
In May 2022, the Oji Group established its purpose as “Grow and manage the sustainable
forest, develop and deliver the products from renewable forest and Oji will bring this world abrighter future filled with hope.” The core of its business is forests, the Oji Group’s cherishedassets. The appropriate cultivation and management of forests not only produces renewable
forest resources; it also helps to enhance the many functions of forests which are of publicbenefit, including absorbing and fixing CO2, conserving biodiversity, cultivating water resources,
and preserving soil. In addition, the Oji Group’s principal business is offering a line-up of
products utilizing forest resources with the aim of supporting and enriching the lives of people
the world over. This same line-up can be used to replace fossil resource-derived materials andproducts. In response to such environmental challenges as dealing with global warming andconserving biodiversity, the Group believes its purpose is to fully leverage these exceedingly
unique characteristics and strengths in its business activities. In the midst of the recent
drastically and rapidly changing business environment, the Oji Group reaffirms its commitment
towards being a manufacturing company that meets the ever-changing needs of the times andsupports its future. The Oji Group will continue advancing forward, aiming towards thedevelopment of a sustainable society.

ii.

ESG Initiatives of the Fundraiser
Paper manufacturing, which is the foundation of the Oji Group, is supported by three types ofrecycling.
① Forest Recycling: Practice sustainable forest management through growing, harvestingand planting trees② Water Recycling: Tackle the reduction of water intake and purification of wastewater③ Paper Recycling: Recycle recovered paper

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

The Oji Group is working to deploy this sustainable business model globally and enable its
businesses to contribute to building a sustainable society.

Figure-1 Three recycling① Forest Recycling: Under the concept of “those who use trees have the responsibility toplant trees,” the Oji Group is working on sustainable forest management by planting,cultivating and utilizing trees and planting them again while giving due consideration to
the local ecosystem in Japan and overseas to create abundant forests.
② Water Recycling: Paper and pulp manufacturing requires a large amount of water. The Oji
Group reduces water intake by treating used water and reusing it in the manufacturing
process. The Group also works on purification of wastewater and reduction ofenvironment impact.
③ Paper Recycling: About 60% of the raw material of the paper is recovered paper andabout 40% is wood. The Oji Group is working on the promotion of use of recovered paperby collecting and utilizing various types of recovered paper while maintaining its recycling
system.

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Oji Holdings Corporation Green Financing Framework Second Party Opinioniii. Environmental Policy of the Fundraiser
The Oji Group believes that those who use trees have the responsibility to plant trees.
Accordingly, the Group has been working since the Meiji Era to fulfill its corporate social
responsibility to society and the environment by planting trees. In 1997, the Groupestablished the Oji Paper Environmental Charter, which adopts as its fundamental principle
helping to create a truly enriching and sustainable society by undertaking business activities
that harmonize with the environment from a global perspective. The Group has continued totake measures centered on sustainable forest management and paper recycling in accordancewith the Oji Group Environmental Charter.

Oji Group Environmental Charter
Basic Policy
The Oji Group Environmental Charter requires the Oji Group to help create a truly enriched and sustainable
society by developing business activities that harmonize with the environment from a global perspective. The
Charter calls for the Oji Group to make autonomous efforts to achieve further environmental improvement,
and aggressively drive its forest recycling, paper recycling, and global warming countermeasures forward.

Action Guidelines
1. Promotion of Forest Recycling
2. Promotion of Paper Recycling
3. Promotion of Global Warming Countermeasures
4. Reinforcement of Environmental Improvement Measures and Environmental Management Systems
5. Development of Production Technologies and Products that Minimize Environmental Impact
6. Reduction and Effective Utilization of Waste
7. Transfer of Environmental Protection Technology to Other Countries
8. Building Relationships of Trust with Stakeholders

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iv. Initiative by the Fundraiser for Net-Zero Carbon by 2050
For the Oji Group that utilizes a range of renewable resources, including wood as raw materials,
the conservation of the natural environment is essential from the perspective of business
continuity. The Group also believes that it will be able to enhance the sustainability of its
business activities through proactive measures to address the issue of climate change.
In order to clearly lay out course of action, the Oji Group formulated "Environmental Vision
2050", which declares the aims for 2050, centers around the goal of net-zero carbon, and isconsidered to be in line with international scenarios such as the Paris Agreement and the path
towards achieving carbon neutrality in 2050, which is targeted in various policies in Japan.
As a milestone on the way to the "Environmental Vision 2050", the Oji Group has established"Environmental Action Program 2030" in September 2020, which sets a target of a 70%
reduction in GHG emissions in FY2030 (compared to FY2018). This consists of reducing GHG
emissions and increasing the net CO2 absorption by forests owned by the Oji Group. The Grouphas created a roadmap (Figure-2) for achieving its targets and has formed a project team toensure the achievement.

Figure-2 Roadmap toward achieving reduction targets for FY2030

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

The FY2030 reduction target comprises the GHG emissions*1 reductions and the expansion of
the Net increment in carbon stocks by forests*2 owned by the Oji Group and to achieve thetarget, the Group is planning investments of 100 billion yen each, totaling 200 billion yen by
2030.
*1 Scope 1 (direct emissions from fuel combustion) + Scope 2 (indirect emissions from the purchase ofelectricity and heat)*2 The net increment in carbon stocks by forests = CO2 absorbed per year with the growth of trees - CO2
emissions per year with felling

Figure-3 FY2030 GHG reduction targets and investments

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Oji Holdings Corporation Green Financing Framework Second Party Opinion(a)

GHG Emissions Reduction

In Environmental Action Program 2030, the Oji Group has set a target of reducing GHG
emissions by 20% (1,567 kt-CO2e) compared to the base year (FY2018). In order to achieve
the target, it takes continuous measures to improve energy efficiency (reducing energy
consumption intensity by thorough energy conservation) and increase the renewable energy
usage rate (such as reducing coal fuel consumption and installing private solar powersystems).
1. Improve Energy Efficiency
The Oji Group has positioned energy conservation as a crucial topic and takes continuous
measures to address it. For example, the Group’s mills/plants regularly hold energy
conservation meetings, attended by personnel from energy management andmanufacturing divisions. Various ideas including equipment update and change inequipment operation method are discussed. Although a lower production volume leads tothe increase of energy consumption intensity, the Group will take continuous measures toaddress energy conservation by suspending surplus equipment and ensuring consistent
power and steam saving.
2. Increase the Percentage of Renewable Energy Use
 Status of examining ways to reduce coal consumption
The Oji Group owns 15 coal-fired boilers in Japan (actual number at the end of FY2021)
and are examining the possibility of fuel conversion for 12 of these, not including
backup boilers, etc. The Group implemented equipment and technological research inconnection with fuel conversion on 3 coal-only-fired boilers, and expect the fuelconversion will help achieve approximately 1,000 kt-CO2 reduction.
 New installation of solar power
Installation of private solar power systems(Installation at Oji Container / Tochigi Plant, Oji Materia / Kushiro, Sobue and Saga Mills
are under consideration.)
Further, the Group will continue its efforts to contribute to lowering third-party GHG
emissions by providing renewable energy through biomass power generation, hydroelectric
power generation, and other forms of production from renewable sources.

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Oji Holdings Corporation Green Financing Framework Second Party Opinion(b)

Expanding the Net Increment in Carbon Stocks by Forests

In Environmental Action Program 2030, the Oji Group has set a target of absorbing andfixing the equivalent of 50% (3,918 kt-CO2e) of GHG emissions in the base year (FY2018).
Accordingly, the Group are aiming to expand its overseas forest plantations to 400,000 ha by
FY2030.
The Group owns a total of 573,000 ha of forests, comprising production forests totaling
432,000 ha in Japan and overseas and conservation forests of 141,000 ha, and practices
sustainable forest management taking into consideration the environment, society andeconomy. The annual average net increment in carbon stocks by forest (the Group’s
production forests and conservation forests) between FY2018 and FY2021 was 653 kt-CO2,
while the actual carbon stocks in living biomass reached 109,000 kt-CO2 at the end of
FY2021.
As a future initiatives, in order to expand the net CO2 absorption, the Group will move
forward to further acquire forest plantations in South America, Oceania, Southeast Asia, etc.
where it is already operating, and facilitate CO2 absorption by developing better fast-growing
trees while planting and cultivating fast-growing trees suitable for the regions where it
operates the forest plantation business.
As of March 2021, preliminary calculations suggest that the expenses associated withexpanding the Group’s overseas forest plantations to 400,000 ha by FY2030 will amount toapproximately 100.0 billion yen. As a result of this expansion, the total area of Oji Forests(production forests and conservation forests) will be 717,000 ha in FY2030.

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Oji Holdings Corporation Green Financing Framework Second Party Opinionv.

SDGs Initiatives of the Fundraiser
Oji has identified the following material issues and corresponding SDGs. Renewableenergy and sustainable forest management, which are the use of proceeds from thegreen finance, will mainly contribute to achieving the first of the following material
issues, Mitigation and adaptation to climate change, and the second, sustainable forest
management (forest recycling).
Table-1 Material issues and SDGs of Oji(extracted from the Oji Group Integrated Report 2022)

Material issues

Qualitative targets

Mitigation and● Reduce GHG emissions

adaptation to● Maintain and expand CO₂

climate change

absorption and fixation throughforest conservation● Increasing in the usage of
renewable energy● Improving in energy efficiency

Sustainable forest● Increase forest certification

management

acquisition rate

(forest recycling)● Maintain and expand overseas
forest plantation

Responsible raw● Manage the supply chainmaterials

thoroughly

procurement
Reduction of● Promote purification ofenvironmental

wastewater and exhaust gases

burdens● Increase effective waste(air, water andutilization ratios

waste)
Effective resource● Improve the recovered paper

utilization

utilization ratio(paper and water● Reduce water intake intensity

recycling)
Stable supply of safe

● Continue zero product liability

and secure products

accidents

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Corresponding SDGs

Oji Holdings Corporation Green Financing Framework Second Party Opinion

Respect for human● Provide education and training

rightsin human rights

Ensuring workplace● Achieve zero fatal and serious

safety and healthwork-related accidents● Reduce lost time injury
frequency rate
● Reinforce safety management
systems, safety risk management
systems, and safety education

Inclusion & diversity● Raise the percentage of female
managers● Raise the employment rate ofpeople with disabilities＊ The relevance of the SDGs is complementary to the green finance, referring to Green, Social andSustainability Bonds: A High-Level Mapping to the Sustainable Development Goals published by
ICMA, which defines the Green Bond Principles. This is a complementary to the green financing
and is not directly related to the purpose for the use of proceeds.

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

vi. External Initiatives
Oji is actively participating in the following external initiatives to strengthen its ESG efforts.

Table-2 External initiatives in which the Oji Group is participating
Initiatives

Descriptions

1

United Nations Global Compact

The Oji Group has been a member of the United
Nations Global Compact, supporting the 10 principles
related to “human rights, labor, environment, and anticorruption”, and striving to put them into practice in its
daily business activities.

2

The Task Force on Climaterelated Financial Disclosures(TCFD)

3

CDP

TCFD is a task force established by the Financial
Stability Board at the request of the G20 to reduce therisk of financial market instability related to climatechange. The Oji Group announced its endorsement of
the TCFD in December 2020 and is working to enhance
disclosure based on the TCFD recommendations.
In December 2022, Oji was recognized with an ‘A’score in CDP “Forests (Timber)” for its sustainable
forest management, and a leadership-level score of ‘A-’in the two categories of “Climate Change” and “Water
Security”.

4

30by30 Alliance for Biodiversity

In April 2022, Oji joined the 30by30 Alliance for
Biodiversity, which was voluntarily started bycompanies, local governments, and organizations topromote initiatives aimed at reaching the 30by30 target(goal of protecting 30% of land and sea by 2030)
across Japan.

5

Dow Jones Sustainability Asia
Pacific Index

In December 2022, Oji was selected as member of the
Dow Jones Sustainability Asia Pacific Index, a globally
representative ESG investment index, which is part of
the Dow Jones Sustainability Index (“DJSI”) for three
years in a row.

6

FTSE4Good Index Series, FTSE
Blossom Japan Index and FTSE
Blossom Japan Sector RelativeIndex

In April 2022, Oji has been selected for inclusion in the
FTSE Blossom Japan Sector Relative Index. In July
2022, Oji has also been selected for inclusion in the
FTSE4Good Index Series and the FTSE Blossom Japan
Index for the fourth consecutive year.

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7

SOMPO Sustainability Index

In June 2022, Oji was selected for the fourthconsecutive year as a member of the SOMPO
Sustainability Index, which comprises approximately
300 companies with outstanding ESG-related initiatives.

8

SUSTAINA ESG AWARDS

Since September 2021, Oji has been awarded Gold in
the Pulp and Paper category of the SUSTAINA ESG
AWARDS, an annual award program that honors
companies actively involved in ESG.

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Oji Holdings Corporation Green Financing Framework Second Party Opinionvii. About the Green Financing Framework
For the purpose of implementing green financing, Oji has established a framework based on
the Green Bond Principles (GBP, 2021) set forth by the International Capital Markets
Association (ICMA), the Green Bond Guidelines of Ministry of the Environment (GBGLs, 2022),
the Green Loan Principles (GLP, 2021) set forth by Loan Market Association (LMA) et.al., and
the Green Loan Guidelines of Ministry of the Environment (GLGLs, 2022).
The entire amount of proceeds from the Green Financing are planned to be allocated to one ormore of the following green project categories, which will be managed and implemented inaccordance with an established framework.

(a)Renewable Energy: biomass (power generation, heat supply), solar energy,hydropower energy, onshore wind energy(b)Sustainable Forest Management: expenditure on acquisition andconservation of production forests and conservation forests

Fundraiser Name: Oji Holdings Corporation
Framework Name: Oji Holdings Corporation Green Financing Framework
Name of External Review Organization: DNV Business Assurance Japan K.K.
Date of Report: 24 January 2023

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II. Scope and Objectives
Oji has commissioned DNV to provide an assessment on framework of the "Oji Holdings
Corporation Green Financing". The objective of the framework assessment of DNV is toconduct an assessment to confirm that Oji meets the criteria such as GBP, GBGLs, GLP,
GLGLs, related technical standards of CBS, which will be described later, and other related
standards or guidelines (see the table below), and to provide a second party opinion on theeligibility of this Green Financing.
DNV, as an independent external reviewer, has identified no real or perceived conflict ofinterest associated with the delivery of this second-party opinion for Oji.
In this paper, no assurance is provided regarding the financial performance of the Green
Financing, the value of any investment in the Green Financing, or the long-term
environmental benefits of the transaction.

(1) Scope of Review
The review assessed the following elements and confirmed their alignment with four core elements in
GBP/GLP.
☒Use of Proceeds☒

Process for Project Evaluation and Selection☒

Management of Proceeds☒

Reporting(2) Role(s) of Review Provider☒

Consultancy (incl. 2nd opinion)☐

Certification☐

Verification☐

Rating☒Other (please specify): Providing review as a green financing issuance supporter (External Review
Division)(3) Standards/Guidelines to be Applied
No.

Standards/Guidelines

Scheme owner

Applied level*1*2

1.

Green Bond Principles

International Capital Market
Association (ICMA), 2021

Apply

2.

Green Bond Guidelines

Ministry of the Environment, 2022

Apply

3.

Green Loan Principles

Loan Market Association (LMA)
et.al. 2021

Apply

4.

Green Loan Guidelines

Ministry of the Environment, 2022

Apply

Climate Bonds Initiative, 2019

Refer (applicabletechnical criteria)International Capital Market
Association (ICMA), 2018

Refer

International Capital Market
Association (ICMA), 2019

Refer

5.
6.
7.

Climate Bonds Standard 3.0v
(Sector Criteria)
Green and Social Bonds: A HighLevel Mapping to the Sustainable
Development Goals
Handbook Harmonized Framework
for Impact Reporting

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

8.

EU Taxonomy

The European Commission (EC)

Refer (applicabletechnical criteria)*1 Apply: Eligibility for all four core common elements to each principle or guideline was assessed.
*2 Refer: Based on the green financing and implementation plans, relevant contents were partiallyconsidered.

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

III. Responsibilities of Oji and DNVOji has provided the information and data used by DNV during the delivery of this review.
DNV's second party opinion represents an independent opinion and is intended to inform Oji
and other interested stakeholders in the bond or loan as to whether the established criteria
have been met, based on the information provided to us. In our work we have relied on theinformation and the facts presented to us by Oji. DNV is not responsible for any aspect of
the selected assets referred to in this opinion and cannot be held liable if estimates, findings,
opinions, or conclusions are incorrect. Thus, DNV shall not be held liable if any of theinformation or data provided by Oji and used as a basis for this assessment were not correct
or complete.

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

IV. Basis of DNV’s Opinion
To provide as much flexibility as possible for the fundraiser, DNV has adapted our green
financing assessment methodologies, which incorporates the requirements of GBP, GBGLs,
GLP, and GLGLs, to create Oji-specific Green Financing Eligibility Assessment Protocol (DNV’s
Protocol). Please refer to Schedule-2. The Protocol is applicable to Green Financing under
GBP, GBGLs, GLP, and GLGLs.
DNV's Protocol includes a set of suitable criteria that can be used to underpin DNV’s opinion.
The overarching principle behind the criteria is that a green financing should "enable capitalraising and investment for new and existing projects with environmental benefits".
As per DNV’s Protocol, the criteria against which the Green Financing has been reviewed aregrouped under the four Principles.

•

Principle One: Use of Proceeds: The Use of Proceeds criteria are guided by therequirement that a fundraiser of a green financing must use the proceeds to eligible
activities. The eligible activities should produce clear environmental benefits.

•

Principle Two: Process for Project Evaluation and Selection: The ProjectEvaluation and Selection criteria are guided by the requirements that a fundraiser of agreen financing should outline the process it follows when determining eligibility of aninvestment using green financing proceeds, and outline any impact objectives it willconsider.

•Principle Three: Management of Proceeds: The Management of Proceeds criteria
are guided by the requirements that a green financing should be tracked within thefundraising organization, that separate portfolios should be created when necessary
and that a declaration of how unallocated funds will be handled should be made.

•Principle Four: Reporting: The Reporting criteria are guided by the recommendationthat at least Sustainability Reporting to the bond and loan investors should be madeof the use of 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 of review of the available information, based on theunderstanding that this information was provided to us by the fundraiser in good faith. We
have not performed an audit or other tests to check the veracity of the information provided
to us. The work undertaken to form our opinion included:i. Pre-Fundraising Assessment of Green Financing•

Creation of the fundraiser-specific Protocol, adapted to the purpose of the Green
Financing, as described above and in Schedule-2 to this Assessment.

•

Assessment of documentary evidence provided by the fundraiser on the Financing
and supplemented assessment by a comprehensive desktop research. These checks
refer to current assessment best practices and standards methodology.

•

Discussions with the fundraiser, and review of relevant documentation.

•

Documentation of findings against each element of the criteria.

ii. Post-Fundraising Assessment of Green Financing (*not included in thisreport)•Assessment of evidential documents provided by the fundraiser after the Financing,and supplemental assessment by desktop survey from a higher perspective.

•

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

•

Field research and inspection (if necessary).

•

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

•

Document creation of post-fundraising verification result.

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

VI. Findings and DNV's opinion
DNV's findings and opinions are as follows.

(1)

Use of Proceeds

DNV has confirmed that all of the net proceeds from Oji Green Financing, excluding
expenses, are planned to be allocated to new investment and refinancing of
construction/installation, operation, and maintenance of one or more of the green
nominated projects that meet the following typical eligible project categories as identified
in the GBP, GBGLs, GLP, and GLGLs.
"Renewable Energy"- Biomass (power generation, heat supply): The nominated project is a biomass
power generation project that refers to Climate Bond Standard. DNV has confirmed thatthe project meets the green eligibility criteria, including the biomass fuel procurement
process, GHG reduction ratio compared to fossil fuels and equipment specifications. DNV
has also confirmed that the local authorities and the surrounding area are taken into
consideration in accordance with relevant laws and regulations, and that even if the
facilities are not subject to environmental assessment as stipulated by law, a simplified
environmental assessment is carried out by a specialized agency to assess the impact of
the construction on the surrounding environment, and appropriate measures are taken
according to the results.
- Solar energy: This is an onshore solar power generation project (including associatedfacilities) that refers to the Climate Bond Standard. In the selection and implementationof eligible projects, DNV has confirmed that the project is related toconstruction/installation, operation, and maintenance of onshore solar power generation
facilities connected to the existing grid, and that no fossil fuel-based back-up powersources are incidental to the project.
- Hydropower energy: This is a hydroelectric power generation project that refers to
the Climate Bond Standard. Depending on the type of hydroelectric power plant inquestion, it is confirmed that the output (W) per unit reservoir/regulating reservoir area(m2) meets the standard values according to the commencement time of operation. DNV
also confirmed that the local authorities and the surrounding area are taken into
consideration in accordance with relevant laws and regulations, and that even if the
facilities are not subject to environmental assessment as stipulate by law, a simplified
assessment is carried out to assess the impact of the construction on the surrounding
environment, and appropriate measures are taken according to the results.
- Onshore wind energy: This is an onshore wind power generation project (including
associated facilities) that refers to the Climate Bond Standard. In the selection andimplementation of eligible projects, DNV has confirmed that the project includes
construction/installation, operation, and maintenance of onshore wind power generation

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

facilities as well as dedicated transmission infrastructure, and not offshore wind power
facilities.

"Sustainable Forest Management"- Capital and operating expenditures on acquisition and conservation of
production forests and conservation forests: This is a project related to acquisitionand conservation of forests that refers to the Climate Bond Standard. DNV has confirmedthat the targeted forests have basically been or are planned to be acquired withsustainable certifications such as FSC, and an assessment has been carried out for theacquisition to ensure that the impact on the surrounding environment is assessed andappropriate measures are taken according to the results.

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

Use of Proceeds categories as per GBP/GLP☒

Renewable energy☐

Energy efficiency (energy saving)☐

Pollution prevention and control☒

Sustainable management of living natural
resources☐

Terrestrial and aquatic biodiversity☐

Clean transportationconservation☐

Sustainable water management☐

Climate change adaptation☐

Eco-efficient products, production☐

Green buildings with regional, national or

technologies and processes

internationally recognized standards andcertifications☐

Other (please specify):☐

It is undecided at the time of fundraising, but is expected to be in line with the GBP/GLP
classification or other eligible areas not listed in the GBP/GLP at this time.

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Oji Holdings Corporation Green Financing Framework Second Party Opinion(2)

Process for Project Evaluation and Selection

Through the review, DNV has confirmed that the green projects listed in Schedule-1
contribute to the Oji Group's initiatives to meet the CO2 emission reduction targets set
forth in its "Environmental Vision 2050" and "Environmental Action Program 2030", aswell as initiatives to help third parties reduce GHG emissions through the supply of
renewable energy electricity.
DNV has confirmed that the Corporate Financial Division of Oji MO which is involved inmanagement support of the Oji Group selects eligible projects after evaluating theireligibility, in cooperation with the Group companies that manage the projects and the Oji
Holdings Corporate Sustainability Division that oversees and manages Groupenvironmental governance, and that the Group CEO makes the final decision.
DNV has also confirmed that upon implementation of green projects, Oji has establishedfollowing systematic procedures against environmental and social impacts.
1.

The Environmental Management Office which is part of the Corporate
Sustainability Division oversees the environmental audits specified in the Group
Environmental Management Regulations, identifies and reduces environmentalgroup-wide risks to prevent environmental accidents from occurring andrecurring by environmental audits.

2.

The Oji Group established the Oji Group Partnership Procurement Policy. When
procuring raw materials for use by the Oji Group, the Group conducts CSR
procurement with the cooperation of suppliers and other business partners, andworks to confirm compliance with laws and regulations and the impact on theenvironment and society.

DNV has confirmed that the selection of projects is in line with the eligibility criteria
shown in "(3) Standards/Guidelines to be Applied in Section II Scope and Objectives" andthat if a project is expected to have a serious negative impact on the environment orsociety, it will be excluded from the eligible projects.

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

Evaluation and Selection☒

Conforms to the fundraiser’s achievement☒of environmental contribution goals☒

Documented process to determine that projects
fit within defined categories

The project is eligible for use of proceeds☒

by green financing and transparency isDocumented process to identify and manage
potential ESG risks associated with the project

ensured☒The project is evaluated and selected based☐

Other (please specify):

on the published standard summary

Information on Responsibility and Accountability☒

Evaluation / Selection criteria subject to☒In-house assessment

external advice or verification☐

Other (please specify):

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Oji Holdings Corporation Green Financing Framework Second Party Opinion(3)

Management of Proceeds

DNV has confirmed how Oji will track and manage the proceeds from fundraising toredemption/repayment period.
DNV has confirmed that Oji plans to allocate the proceeds to financing (new investment
and financing) and refinancing to the eligible projects in a timely manner after raising theproceeds. In the case of refinancing, only projects that have made expenditures within
three years of the green financing are eligible for refinancing. The raised proceeds are
expected to be allocated within approximately two years from the date of procurement.
The allocation status of proceeds will be managed by the Corporate Financial Division ofOji MO through internal systems such as CMS and be monitored through a dedicatedledger or other means.
Unallocated proceeds will be managed as cash or cash equivalents until they are fully
allocated to eligible projects.

Tracking of Proceeds:☒

Some or all of the proceeds by green financing that are planned to be allocated are systematicallydistinguished or tracked by the fundraiser.

☒

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

Other (please specify):

Additional Disclosure:☐

Allocations to future investments only☒☒

Allocation to individual disbursements☒

Allocation to a portfolio of disbursements☐

Disclosure of portfolio balance of☒

Other (please specify): The amount of existing

Allocations to both existing and future
investments

unallocated proceeds

investments and new financing of projects
covered by the green financing will be disclosed
in the annual report.

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Oji Holdings Corporation Green Financing Framework Second Party Opinion(4)

Reporting

DNV has confirmed that Oji will report specific information related to green financing
required by the GBP, GBGLs, GLP, and GLGLs in its website at least once a year.
The following items are planned to be disclosed on the allocation status of proceeds until
the full amount of the proceeds has been allocated. In addition, the following items
related to environmental benefits are planned to be disclosed to the extent practicable.
While disclosure is basically planned on a project basis, depending on the circumstances,disclosure will be made on a category basis. It is also planned to disclose any materialchanges in the projects in a timely manner.

<Allocation Status>•

Allocated amount for each eligible project (including amount or percentage of
new financing and refinancing)•

Unallocated amount<Environmental Benefits>
Project
Category

Eligible Projects

Reporting details

 Biomass (power
generation, heat
Renewable
Energysupply) Solar energy Hydropower energy
 Onshore wind

 Brief description of projects
 Electricity generated (MWh) or capacity (MW)(In the case of heat supply, capacity of boilers) CO2 emission reduction (estimated)energy Capital andoperatingexpenditures

 Brief description of projects

Sustainable

relating to Area of forests subject to sustainable forest

Forestacquisition andManagement

conservation of
production forests

management (ha)
 Amount of carbon fixed (t-CO2) or net
increment in carbon stocks by forests (t-CO2)

and conservation
forests

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

Use of Proceeds Reporting:☒

Project-by-project☒

On a project portfolio basis☐

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

Information reported:☒☐

Allocated amountAmount allocated to green financing out of thetotal investment☒

Other (please specify): Unallocatedamount and percentage of proceeds thathave been allocated to refinancing

Frequency:☒

Annual☐Other (please specify):☐

Semi-annual

Impact Reporting (environmental benefits):☒

Project-by-project☒

On a project portfolio basis☐

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

Frequency:☒

Annual☐Other (please specify):☐

Semi-annual

Information reported (expected or post-fundraising):☒

GHG emissions / fixed or net absorption☐☒

Other ESG indicators (please specify):

Electricity generated (MWh) or capacity (MW), area ofEnergy savings

forests (ha)Means of Disclosure☐

Information published in financial report☐

Information published in sustainability report☐

Information published in ad hoc documents☒

Other (please specify): Fundraiser’s website☐

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

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

Assessment Conclusion
On the basis of the information provided by Oji and the work undertaken, it is DNV’s opinion
that Oji meets the criteria established in DNV’s Protocol and that it is aligned with the stateddefinition or purpose of green financing within GBP, GBGLs, GLP, and GLGLs, which is to"enable capital-raising and investment for new and existing projects with environmental
benefits".

DNV Business Assurance Japan K.K.
24 January 2023

Mark Robinson

Naoki Maeda

Manager, Sustainability Services

Managing Director

DNV Business Assurance, Australia

DNV Business Assurance Japan K.K.

Masato Kanedome

Jun Chokai

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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Oji Holdings Corporation Green Financing Framework Second Party Opinion

Schedule-1 Green Financing Nominated Projects
Oji Holdings Corporation Green Financing will be allocated to one or more of the projects listed in Schedule-1. The projects selected for allocation will
be disclosed in the Annual Report. In the case of green project categories that are currently under development or planning and for which there are no
specific candidate projects, only those projects that are evaluated and confirmed by Oji in the future will be eligible for allocation.

No.

Category

1

Sub Category
Biomass energy

Project Overview
Planning, construction, operation, and revamping of biomass power projects

Solar energy

Planning, construction, operation, and revamping of solar power projects

3

Hydropower energy

Planning, construction, operation, and revamping of hydropower projects

4

Onshore wind energy

Planning, construction, operation, and revamping of onshore wind power projects

ForestProduction forests,

Management

conservation forests

Capital and operating expenditures relating to acquisition and conservation of
production forests and conservation forests2
Renewable
EnergySustainable
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Oji Holdings Corporation Green Financing Framework Second Party Opinion

Schedule-2 Green Financing Eligibility Assessment Protocol

The following GBP/GLP-1 – GBP/GLP-4 are DNV's Green Financing Eligibility Assessment Protocol created for Oji based on the requirementsof Green Bond Principles (GBP) and Green Loan Principles (GLP).

GBP/GLP-1 Use of Proceeds
Ref.

Criteria

Requirements

Work Undertaken

1aType offunds

The types of green finance are classified into one of the following
types defined by GBP/GLP:• Framework• Interviews

•
•
•
•

(Standard) Green Bond/Loan
Green Revenue Bond/Loan
Green Project Bond/Loan
OthersDNV Findings
The reviewed evidence confirms that the Green
Financing falls in the category:· (Standard) Green Bond/Loan

1b

Green
projectclassification

The key to a green finance is that the proceeds will be used for agreen project, which should be properly stated in the legal
documents relating to the security.

• Framework• Interviews

DNV confirmed that the net proceeds from theGreen Financing will be allocated to newinvestment and refinancing of green eligible
projects, which will be properly described in the
Amended Shelf Registration Statement.
Specifically, the proceeds will be allocated to
one or more of the following Green Financing
nominated projects.
Renewable energy (biomass (power
generation, heat supply), solar energy,hydropower energy, onshore wind energy
Sustainable forest management (capitaland operating expenditures on acquisitionand conservation of production forests andconservation forests)

1cEnvironment

All green projects to which the funds are used should have clear• Framework

DNV confirmed that green projects have

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Oji Holdings Corporation Green Financing Framework Second Party Opinion

Ref.

1d

Criteria

Requirements

Work Undertaken

DNV Findings

al benefits

environmental benefits, the effects of which should be assessedby the issuer/borrower and, where possible, quantitatively
demonstrated.

• Interviews

environmental benefits as the increase ofrenewable energy, and that the environmental
benefits are quantitatively assessed such as theamount of CO2 emissions reduction and carbon
fixed.

Refinancing
rate

If all or part of the proceeds are used or may be used forrefinancing, the issuer/borrower will indicate the estimated ratioof the initial investment to the refinancing and, if necessary.
Therefore, it is recommended to clarify which investment or
project portfolio is subject to refinancing.

• Framework• Interviews

DNV confirmed that the issuer plans to disclose
the percentage of the proceeds allocated forrefinancing on its website at least once a year.

GBP/GLP-2 Process for Project Evaluation and Selection
Ref.

Criteria

Requirements

Work Undertaken

2aProject
Selection
process

Green finance issuer/borrower should provide an overview of theprocess of qualifying projects for which green finance funding will
be used. This includes (but is not limited to):・ The process by which the issuer/borrower determines that the
project in question is included in the business category of aqualified green project.
・ Creation of criteria for eligibility of projects for which green
finance funding will be used.
・ Environmental sustainability goals.

• Framework• Interviews

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DNV Findings
DNV confirmed through the framework that Oji
has a process for evaluating the eligibility of
projects for which the raised proceeds are used.
Specifically, a process has been established inwhich the Corporate Financial Division of Oji MOselects eligible projects after evaluating theireligibility, in cooperation with the Group
companies that manage the projects and the Oji
Holdings Corporate Sustainability Division thatoversees and manages Group environmental
governance, and the Group CEO makes the final
decision.
As a goal related to environmental sustainability,
fuel procurement for biomass power generation isOji Holdings Corporation Green Financing Framework Second Party Opinion

Ref.

2b

Criteria

Issuer’s/borr
ower’senvironmental, social
governanceframework

Requirements

Work Undertaken

In addition to criteria and certifications, the information publishedby issuers/borrowers regarding the green finance process also
considers the quality of performance of the issuer's/borrower’s
framework and environmental sustainability.

Page 35 of 37• Framework• Interviews

DNV Findings
limited to FSC and other certified sources. In
addition, it is planned that production forests andconservation forests to be acquired overseas willbasically have FSC, PEFC, or other certifications.
DNV confirmed that the green projects
implemented by Oji are in line with the"Environmental Vision 2050," which declares toachieve "net-zero carbon" in FY2050, and the"Environmental Action Program 2030," which
establishes a target to reduce GHG emissions by
70% by 2030.
DNV also confirmed that the environmental
aspects of the project will be fully considered andappropriately addressed based on the"Environmental Management System (EMS)" and"Environmental Audits".

Oji Holdings Corporation Green Financing Framework Second Party Opinion

GBP/GLP-3 Management of Proceeds
Ref.

Criteria

3a

Tracking
procedure-1

3b

Tracking
procedure-2

3c

Temporaryholding

Requirements

Work Undertaken

The net proceeds from of green finance should be managed in
sub-accounts, included in sub-portfolio, or otherwise tracked. It
should also be certified by the issuer/borrower in a formalinternal process related to the issuer's/borrower’s investment andfinancing operations for the Green Project.

• Framework• Interviews

DNV confirmed that the net proceeds of theGreen Financing are managed through internal
systems such as CMS and are traceable througha dedicated ledger or other means.

During the green finance redemption/repayment period, thebalance of funds raised that is being tracked should be adjusted
at regular intervals to match the amount allocated to eligible
projects undertaken during that period.

• Framework• Interviews

DNV confirmed that it is planned to monitor thebalance of the Green Financing on a regular basis
from its execution to redemption/repayment
using a dedicated ledger or other means.

If no investment or payment has been made in a qualified green
project, the issuer/borrower should also inform theinvestor/lender of the possible temporary investment method forthe balance of unallocated proceeds.

• Framework• Interviews

DNV confirmed that unallocated proceeds will be
managed in cash or cash equivalents until the fullamount of proceeds are allocated to eligible
projects, and that the balance of unallocatedproceeds will be disclosed through reporting on
the allocation status.

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DNV Findings

Oji Holdings Corporation Green Financing Framework Second Party Opinion

GBP/GLP-4 Reporting
Ref.

Criteria

4aPeriodical
reporting

Requirements

Work Undertaken

In addition to reporting on the use of proceeds and the temporary
investment of unallocated proceeds, the issuer/borrower willconsider each project at least once a year for projects to which theGreen finance proceeds have been allocated, taking into accountthe following: A list of each project should be provided.
-Confidentiality and competitive considerations-Outline of each project, expected sustainable environmental andsocial effects• Framework• Interviews

DNV Findings
DNV confirmed that Oji plans to disclose theallocation status and environmental benefits atleast once a year on its website, until all proceeds
are allocated to eligible projects.
Allocation status
Allocated amount for each eligible project(including amount or percentage of new
financing and refinancing)
Unallocated amountImpact reporting<Renewable Energy>
・ Brief description of projects
・ Electricity generated (MWh) or capacity (MW)(In the case of heat supply, capacity of boilers)
・ CO2 emission reduction (estimated)<Sustainable Forest Management>
・ Brief description of projects
・ Area of forests subject to sustainable forest
management (ha)・ Amount of carbon fixed (t-CO2) or net
increment in carbon stocks by forests (t-CO2)

Page 37 of 37