[Translation]

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

CORPORATE GOVERNANCE REPORT
Last Update: June 27, 2024
Kazuho Takahashi
President & CEO

VT Holdings Co., Ltd.

Contact: Administration Department+81-52-203-9500
Securities Code: 7593
https://www.vt-holdings.co.jp/eng/
The corporate governance of VT Holdings Co., Ltd. (the “Company”) is described below.

I.

Basic Views on Corporate Governance, Capital Structure, Corporate Attributes and Other
Basic Information

1. Basic Views Updated
Based on the recognition that continuously building and maintaining an organizational structure that is able toswiftly respond to changes in the business environment is one of the key business issues for the Company group(the “Group”), the Company has adopted a holding company system delegating authority and placing the
responsibility for managerial execution with each Group company so that each company may manage its businesswith speed and autonomy in pursuit of maximum business results. As a holding company, we also supervise eachcompany’s business planning from the perspective of the Group’s overall optimization and determine the efficient
allocation of management resources such as capital and human resources through continued monitoring andevaluation of the state of business execution.
The Company transitioned to a company with an Audit and Supervisory Committee pursuant to the resolution at
the 42nd Ordinary General Meeting of Shareholders held on June 27, 2024, aiming to further strengthen the
supervisory function of the Board of Directors by means of granting the Audit and Supervisory Committee theright to state its opinions at a General Meeting of Shareholders concerning the election and remuneration of
Directors (excluding Directors who are Audit and Supervisory Committee Members), while the Audit andSupervisory Committee members, who are responsible for auditing and supervising the business execution of
Directors, exercise their voting rights at meetings of the Board of Directors.
Moreover, the Company provides various committees with management oversight functions in addition to theBoard of Directors and the Audit and Supervisory Committee as a means of internal control for the Group,
clarifying their roles in management decision-making, business execution, and management supervision topromote greater transparency and fairness in management as well as thorough compliance.
In addition, the Company has established the Basic Policy on Corporate Governance below with respect to ouradherence with the principles of the Corporate Governance Code.
(Basic Policy on Corporate Governance)
The Company views corporate governance as the basis of company activities in ensuring transparency, soundness,
swiftness, and efficiency in corporate management and business execution for all stakeholders. By ensuring
appropriateness in business through initiatives to develop the internal control system, which is the basis ofcorporate governance, we endeavor to ensure that corporate governance functions effectively, achieve sustainablegrowth as a Group, and improve medium- to long-term value.
1. We shall endeavor to secure shareholder rights and equality.
In order to ensure shareholder rights and equality, we shall create the requisite environment to allow all
shareholders, including minority shareholders, to appropriately exercise their voting rights, as well as properly
and fairly disclose information at the appropriate time.
-1-

[Translation]
2. We shall endeavor to achieve appropriate collaboration with other stakeholders in addition to shareholders.
We aim to improve our Group corporate value in society by taking into consideration the interests of various
stakeholders in addition to our shareholders, and building a favorable collaborative relationship with them.
3. We shall endeavor to appropriately disclose information and ensure transparency.
Not only do we disclose information as mandated by laws and regulations, but we also extensively disclose
information that is important to stakeholders accurately, swiftly, and in a way that is easily accessible.
4. We shall endeavor to properly execute the duties of the Board of Directors.
The Board of Directors is responsible for the Group’s sustainable growth and corporate value improvement
through effective corporate governance, and to fulfill these responsibilities, they shall provide supervisory
functions over general execution of business, and strive to make better decisions in achieving fair management.
5. We shall endeavor to achieve active and constructive dialogue with shareholders.
In addition to the general meeting of shareholders, we provide opportunities for dialogue with shareholders
through financial briefing meetings and investor briefing meetings, along with actively providing investor
relations (IR) information as material for dialogue in order to deepen shareholder understanding of Groupbusiness and achieve active and constructive dialogue between the Company and shareholders.
[Reasons for Noncompliance with the Principles of the Corporate Governance Code][Supplementary Principle 4.2.1 Roles and Responsibilities of the Board (2)]The President & CEO has been entrusted by the Board of Directors to determine the amount of individual
remuneration for each Director (excluding Directors who are Audit and Supervisory Committee Members) within thescope of remuneration approved at the general meeting of shareholders in accordance with Principle 3.1 iii). The
President & CEO takes into comprehensive consideration each Director’s position, an evaluation of the executionof his/her duties, the Company’s performance and state of management over the past fiscal year, as well as theCompany’s medium- to -long-term performance and economic conditions, among others, and makes thisdetermination based on a report by the Nomination and Remuneration Committee. The Nomination andRemuneration Committee will also proceed with discussions on a remuneration system that follows objective andtransparent procedures and consider matters such as the ratio of remuneration linked to medium- to long-termbusiness performance as well as the ratio of cash-based to stock-based remuneration.
[Disclosure Based on the Principles of the Corporate Governance Code][Principle 1.4 Cross-Shareholdings](Policy on Cross-Shareholdings and Reducing Cross-Shareholdings)
The Company permits shares to be held as cross-shareholdings only if, upon examining the economic rationale
for the holding, the Company deems it to be appropriate from the overall perspective of maintaining andstrengthening a business relationship and strategic alliance with the counterparty, as well as the growth potential
and financial security of said counterparty.
Given the considerations noted above, the Board of Directors regularly reviews whether or not to continue holding
such shares by taking into account earnings targets based on the cost of capital (the cost of equity and weighted
average cost of capital (WACC)), actual returns, and trading conditions.
The Board of Directors found the returns of some individual holdings to fall below the WACC at its meeting inJanuary 2024. However, it has determined that there are shares for which it is appropriate to continue the holding
as well as it is appropriate to reduce the holding considering the degree to which said shares contribute to theGroup’s business earnings. The Company will promote the shares for which reduction is deemed to be appropriate
through sufficient dialogues with the counterparty.
■ Criteria for the Exercise of Voting Rights Pertaining to Cross-Shareholdings
In exercising voting rights from shares of listed companies held, the Company considers the proposals and makesa comprehensive judgement as to whether they will contribute to improving the medium- to long-term value of
the Company and contribute to common shareholder interest of the investee, and exercises its voting rights asappropriate.
-2-[Translation][Principle 1.7 Related Party Transactions]
When the Company engages in transactions with related parties such as Directors or major shareholders, theCompany will implement procedures that comply with laws and regulations with respect to matters that formallyconstitute the appearance of a conflict of interest. In addition, in order to ensure that such transactions do notcompromise the interests of the Company or the common interests of its shareholders, the Company requires
deliberation and approval by the Board of Directors and other such procedures prescribed in the relevant
regulations prior to executing such transactions.
The Board of Directors also periodically surveys all Directors to confirm the existence of any related party
transactions, and has established a system for managing related party transactions.
[Supplementary Principle 2.4.1 Ensuring Diversity, Including Active Participation of Women]
The Group is of the belief that by recognizing and accepting differences in character and values, and by having
an accurate grasp on societal changes and needs, it will be able to create new products and services. As such, theGroup shall actively recruit outstanding talent regardless of gender, nationality, or other attribute.
Women in particular held approximately 5.4% of management positions as of March 2024, though we are aiming
to increase this ratio to 10%. Meanwhile, we are not aware of any particular disparities in promotion to
management positions based on nationality or time of hire, and as such have not currently set or disclosed targets
for the promotion of foreign nationals and mid-career hires to management positions.
In addition, we have established the Human Resource Training Policy and the Internal Environment Development
Policy as a means of ensuring diversity in our core human resources. Based on these policies, we have
implemented a system to subsidize the cost of acquiring qualifications and a remote work system in an effort tocreate an environment in which employees can flourish. For more information, please see our website (URL:
https://sdgs.vt-holdings.co.jp/eng/social/).
[Principle 2.6 Role of Corporate Pension Funds as Asset Owners]
The Company has introduced a defined contribution pension plan, and no conflicts of interest arise between thebeneficiaries of the corporate pension funds and the Company. Therefore, in lieu of appointing, assigning, andtraining personnel to fulfill the functions expected of the pension fund as an asset owner, the Company provides
employees with explanations regarding the selection of investment products and asset management under thedefined contribution pension plan upon hire. The Company also provides regular educational opportunities todeepen employee understanding of the plan.
[Principle 3.1 Full Disclosure]i. Company objectives (e.g., business principles), business strategies and business plans
The Company publishes its corporate philosophy, business principles, medium- to long-term vision, businessexpansion strategy and other information on the “IR Message from the President” and “Business Models forAchieving Growth” pages of its website.
IR Message from the President: https://www.vt-holdings.co.jp/eng/ir/message.html
Business Models for Achieving Growth: https://www.vt-holdings.co.jp/eng/ir/business-model.html
ii. Basic views and guidelines on corporate governance based on each of the principles of the Code
The Company views corporate governance as the basis of company activities in ensuring transparency,
soundness, swiftness, and efficiency in corporate management and business execution for all stakeholders,
including shareholders. By ensuring appropriateness in Group business through initiatives to develop theinternal control system, which is the basis of corporate governance, we endeavor to ensure that corporate
governance functions effectively, achieve sustainable growth for the Group, and improve medium- to longterm value.
iii. Board policies and procedures in determining the remuneration, etc. of senior management and Directors
The Company resolved, at its meeting of the Board of Directors held on May 27, 2024, to abolish the
Retirement Benefit Plan for Officers at the conclusion of the 42nd Ordinary General Meeting of Shareholders
held on June 27, 2024, and resolved, at the said General Meeting, to provide final retirement benefits and topartially revise the policy for determining the details of remuneration for individual Directors to the provisions
described below.
Remuneration for Directors (excluding Directors who are Audit and Supervisory Committee Members) of theCompany consists solely of fixed remuneration in the form of basic remuneration, and the Company’s basic
policy is to determine an appropriate level of remuneration for each individual Director (excluding Directors who-3-[Translation]
are Audit and Supervisory Committee Members) based on his/her responsibilities. The whole amount of remuneration
for Outside Directors and Directors who are Audit and Supervisory Committee Members also consists solelyof fixed remuneration in the form of basic remuneration in light of their responsibilities. The specific policies
for each form of remuneration are as follows:
•

•
•

•

Basic remuneration shall consist of fixed monthly remuneration and shall be determined according to the
Director’s position, responsibilities, and tenure in comprehensive consideration of market standards, theCompany’s performance, evaluation of the Director’s execution of his/her duties, medium- to long-term
economic conditions, and other factors.
The amount of individual remuneration, etc. for each Director (excluding Directors who are Audit andSupervisory Committee Members) shall be determined by the President & CEO, who has been entrusted
by resolution of the Board of Directors with the authority to do so. To ensure that the President & CEO
exercises this authority in a proper fashion, the Board of Directors shall consult with the Nomination andRemuneration Committee on proposed remuneration and seek its report, based on which the President &CEO shall make the said determination.
The amount of individual remuneration for each Director who is an Audit and Supervisory Committee
member shall be determined through consultation among Directors who are Audit and Supervisory
Committee Members.

iv. Board policies and procedures in the appointment/removal of senior management and the nomination of
Director candidates
The Company adopts policies 1 and 2 below for its procedures in selecting Director candidates. Each Outside
Director is considered to possess independence to the Company by having no special personal, capital or
business relationship or other interests in the Company in accordance with the independence criteria
established by the Tokyo Stock Exchange. The reasons for the nomination of candidates for Outside Director
are stated in the notice of the general meetings of shareholders and in the Annual Securities Report.
In addition, the Board of Directors shall make its determinations in removing Directors based on policy 3.
below.
1. Nomination of candidates for Director (Excluding Directors who are Audit and Supervisory Committee
members)
In appointing Directors (excluding Directors who are Audit and Supervisory Committee Members),
nominations are made following deliberation by the Board of Directors based on a report by the Nomination
and Remuneration Committee and in accordance with the selection criteria below.
[Selection criteria](1) Understands the Company’s corporate philosophy and business principles, and can be expected tocontribute to the further growth and development of the Group’s business through his/her exceptional
ability to make management decisions and extensive experience(2) Able to understand and resolve issues pertaining to business management(3) Possesses a high degree of knowledge regarding laws and regulations and corporate ethics
2. Nomination of candidates for Director who is an Audit and Supervisory Committee Member
In appointing Director who is an Audit and Supervisory Committee Member, nominations are madefollowing deliberation by the Board of Directors in accordance with the selection criteria below withconsideration given to the opinions of Independent Outside Directors, and with the approval of the Audit
and Supervisory Committee.
[Selection criteria](1) Possesses a deep understanding of the Company’s corporate philosophy, business principles, andbusiness activities(2) Able to conduct audits and supervision from an independent and neutral perspective with a high levelof expertise and knowledge(3) Able to contribute to improving the soundness and transparency of the Group by auditing and overseeing
whether Directors (excluding Directors who are Audit and Supervisory Committee Members) are in full compliancewith laws and regulations and the Articles of Incorporation in executing their duties-4-

[Translation]

3. Removal of Directors
The Board of Directors shall make decisions on proposals for the removal of Directors following
deliberation based on a report by the Nomination and Remuneration Committee and in accordance with theremoval criteria below.
[Removal criteria](1) Committing an act that is offensive to public order and morals(2) Health reasons that make it difficult for the Director to continue engaging in his/her duties(3) Failure to perform duties that results in material damage to corporate value(4) Falling subject to the grounds for disqualification as Director provided for in Article 331, paragraph 1of the Companies Act(5) Failure to meet the qualifications specified in the selection criteria
v. Explanations with respect to the individual appointments/removals and nominations when the Board of Directors
appoints/removes senior management and nominates Director candidates based on iv.
The reasons for the nomination of candidates for senior management and Outside Director are disclosed in thenotice of the general meetings of shareholders.
[Supplementary Principle 3.1.3 Full Disclosure]
The Group has established the Sustainability Committee to promote sustainability management and discloses its
Group-wide environmental and social contribution efforts on the Company’s website (URL: https://sdgs.vtholdings.co.jp/eng/).
In addition, the Company sees investing in human capital as a medium-term business issue. As such, the Company
is working to create a system that will allow each and every employee to demonstrate his/her abilities byproactively investing in human resource development and in improving the Company’s in-house environment
based on the policies described under Principle 2.4.1. In order to leverage upon the intellectual property the Group
has accumulated, we are also promoting not only patents and trademarks but digital transformation (DX)investment to make use of the Group’s internal databases, know-how, customer networks and other intangible
assets.
With regard to the impact of climate change-related risks and earning opportunities on the Company’s businessactivities and revenue, we collect and analyze the requisite data for disclosure on our website in accordance with
the TCFD framework (URL: https://sdgs.vt-holdings.co.jp/eng/environment/).
[Supplementary Principle 4.1.1 Roles and Responsibilities of the Board (1)]The Company clearly stipulates the authority of the Board of Directors and senior management in the Regulations of theBoard of Directors, internal regulations, and the Regulations on Administrative Authority. The matters that require a resolutionof the Board of Directors include the matters specified by laws and regulations and important matters related to businessexecution, personnel affairs, and shares and corporate bonds.
[Principle 4.9 Independence Standards and Qualification for Independent Directors]
The Company has adopted the independence criteria established by the Tokyo Stock Exchange and selects
candidates for Independent Outside Director following deliberation by the Board of Directors based on said criteria.
[Supplementary Principle 4.10.1 Use of Optional Approach]
The Company has voluntarily established the Nomination and Remuneration Committee as an advisory body to
the Board of Directors comprised of Independent Outside Directors as its principal members. The purpose of theCommittee is to strengthen the independence, objectivity, and accountability of the Board of Directors pertaining
to the nomination (including succession planning) of and remuneration for senior management and Directors.
The members and chairperson of the Nomination and Remuneration Committee shall be appointed by resolutionof the Board of Directors. The Committee shall consist of at least three (3) Outside Directors and may also include
Inside Directors as necessary. The Committee currently consists of four (4) Independent Outside Directors andone (1) Inside Director, with Independent Outside Directors comprising the majority. An Independent Outside
Director serves as the chairperson.
The Board of Directors consults with the Nomination and Remuneration Committee in advance on matters related
to nominations and remuneration, and makes decisions based on the Committee’s report to ensure its proper
involvement and counsel, including its perspectives on gender and other diversity-related matters as well as skills.

-5-[Translation][Supplementary Principle 4.11.1 Preconditions for the Board Effectiveness]
The Company’s Board of Directors shall be comprised of twelve (12) Directors (excluding Directors who are
Audit and Supervisory Committee Members) or less, and the number of Directors who are Audit and Supervisory
Committee Members s「」hall be six (6) or less as stipulated in the Articles of Incorporation. The basic view of
the Company is that the Board of Directors should be of an appropriate size to engage in effective discussions andbe comprised of diverse personnel with a balance between the knowledge, experience, and abilities necessary tooversee the promotion of the Company’s business strategy. The Company has prepared a skill matrix summarizing
said knowledge, experience, and abilities, which is disclosed in the notice of the general meetings of shareholders
and on the Company’s website (URL: https://www.vt-holdings.co.jp/about/officers.html).
[Supplementary Principle 4.11.2 Preconditions for Board Effectiveness]
The Company has established internal regulations stipulating that Directors, excluding Outside Directors, mustobtain approval from the Board of Directors to concurrently serve as an officer of another listed company. The
Company has also established a system to oversee the status of concurrent positions held by all Directors.
Said details are disclosed in the Business Report issued during the annual Ordinary General Meeting of
Shareholders.
[Supplementary Principle 4.11.3 Preconditions for the Board Effectiveness]
1. Evaluation policy and processes
The Company has continuously conducted self-analysis and evaluations of the effectiveness of the Board of
Directors since 2017 in order to improve its function and increase corporate value.
In order to ensure objectivity in our self-evaluation and analysis, we once again prepared a questionnaire in
the fiscal year 2024 with the cooperation and advice of an external organization independent of the Company
comprised of 52 questions, some of which were changed from the previous year. We adopted an anonymous
format in which respondents return their answers to the external organization directly to ensure anonymity. In
addition, an external organization conducted interviews with all Directors and all Audit and Supervisory
Committee Members.
2. Summary of evaluation results and future efforts
Analysis of the responses found the evaluations to be generally positive, and we therefore regard theeffectiveness of the Company’s Board of Directors to have been secured.
The Board of Directors has voluntarily established Nomination and Remuneration Committee to address issues
to be improved identified at the previous effectiveness evaluation, such as succession planning for the CEO
and other top executives of the Board of Directors, the officer nomination process, and designing remuneration
programs for the executive members of the Board of Directors. Thus, we believe that efforts have been madefor measures and improvement in areas such as active participation by the Nomination and Remuneration
Committee in formulation and operation of the succession plan for the CEO and the use of the skills matrix asreference in relation to the nomination of officers.
Meanwhile, the following issues were identified through this year’s questionnaire. Efforts will be made to
implement related improvements.
• Determine policies for the entire Group’s business portfolio and periodically review such policies• Verify investment into human capital and intellectual property and oversee the appropriate implementation ofsuch investment• Ensure the provision of better information to facilitate a good quality discussion
The issues identified through this year’s questionnaire include those that can be improved in the short term
and those that require sufficient consideration. Accordingly, the Company’s Board of Directors will addressthese issues by responding to and considering them based on the results of this evaluation and will continue tomake efforts to improve the function of the Board of Directors.

-6-

[Translation][Supplementary Principle 4.14.2 Director Training]
The Company is always collecting and providing information on matters related to its business, organization,
financial accounting, as well as laws and regulations needed for Directors to fulfil their roles and functions.
In addition, the Company continuously provides opportunities for Directors to acquire knowledge required forbusiness operations, including through external training and in-house seminars.
[Principle 5.1 Policy for Constructive Dialogue with Shareholders]
The Company holds twice-a-year financial briefing meetings during which the President & CEO provides
explanations and addresses questions. The presentation materials of financial results for these meetings are madepublic through the Company’s website and other means. In addition, the Company has held its financial briefing
meetings online via the Internet, archived videos of which are made available for streaming or by other means inan effort to create opportunities for more shareholders and potential shareholders to deepen their understandingof the Company.
The Company has adopted the following policy to ensure that active and constructive dialogue with shareholders
contributes to the Company’s sustainable growth and medium- to long-term increase in corporate value.
(Policy for Dialogue with Shareholders)
1. We shall strive to disclose information to our shareholders and enhance corporate value through constructive
dialogue with them.
2. The Officer(s) in charge of IR shall respond to requests for dialogue (meetings) from shareholders to areasonable extent based on the shareholders’ intent.
3. The Officer(s) in charge of IR shall collaborate with the department(s) in charge of IR and other relevantinternal departments to ensure that information reflecting the interests of shareholders can be provided asnecessary.
4. The Officer(s) in charge of IR shall proactively implement and enrich IR activities such as financial briefing
meetings and corporate briefing meetings as means of engaging in shareholder dialogue in addition toindividual meetings.
5. The Officer(s) in charge of IR shall provide feedback to the Board of Directors as appropriate on the opinions,concerns, interests, and requests of shareholders that have been identified through dialogue with said
shareholders and reflect these in the Company’s management.
6. The Officer(s) in charge of IR shall manage undisclosed material internal information (insider information) inan appropriate manner in collaboration with the person(s) in charge of information management in accordancewith the Company’s internal regulations (“Regulations for Preventing Insider Trading”).
(Status of Implementation of Dialogues with Shareholders)
The status of the implementation of dialogues with shareholders for the fiscal year ended March 31, 2024, is asfollows:(1) Persons who basically engage in dialogues with shareholders- Individual dialogue with institutional investors (President, General Manager of the Administration Division)- Financial briefing meetings for analysts and institutional investors (President, General Manager of the
Administration Division)(2) Overview of shareholders who participated in dialogues
We conducted the face-to-face dialogues with analysts and fund managers for shareholders in Japan andoverseas. In addition, President and General Manager of the Administration Division as explainer conducted alively question-and-answer session at the financial briefing meeting and facilitated proactive dialogues.
(3) Main themes of dialogues and interests of shareholders
We are exchanging wide-ranging opinions on topics, such as capital policy, including the summary of financial
results earnings forecast, and shareholder returns, and medium- to long-term policy regarding M&A.
(4) Status of feedback to the senior management and the Board of Directors regarding opinions and concerns
learned through the dialogue and actions taken based on the dialogues
Opinions and concerns from shareholders are periodically reported at the Board of Directors meetings and areshared as appropriate between the senior management and the department in charge of IR.
[Action to Implement Management That is Conscious of Cost of Capital and Stock Price (Under Consideration)][Disclosure in English is Available]
The Board of Directors is considering future policies and specific measures based on the analysis and evaluation of-7-

[Translation]
the current status of the Company’s cost of capital, profitability of capital, and market valuation. The Company willpromptly disclose the details as soon as they are determined.

2. Capital Structure
Percentage of Foreign Shareholders

10% or more but less than 20%[Status of Major Shareholders]Name / Company Name

Number of Shares Owned(Shares)

Percentage (%)

S&I Co., Ltd

16,863,488

14.04

The Master Trust Bank of Japan, Ltd. (Trust
Account)

13,079,500

10.89

Mitsui Sumitomo Insurance Company,
Limited

7,662,000

6.38

Custody Bank of Japan, Ltd. (Trust Account)

6.621,700

5.51

Sompo Japan Insurance Inc.

4,000,000

3.33

Aioi Nissay Dowa Insurance Co., Ltd.

3,702,000

3.08

Tokio Marine & Nichido Fire Insurance Co.,Ltd.
Kazuho Takahashi

3,702,000

3.08

3,577,800

2.97

Junko Takahashi

3,248,400

2.70

Morgan Stanley MUFG Securities Co., Ltd.

2,018,197

1.68

Controlling Shareholder (Excluding Parent
Company)—

Parent Company

None

Supplementary Explanation
The information listed in [Status of Major Shareholders] in 2. Above is as of March 31, 2024. The percentages in[Status of Major Shareholders] in 2. above have been calculated less the number of treasury shares.

3. Corporate Attributes
Listed Stock Market and Market Segment

Tokyo Stock Exchange Prime Market
Nagoya Stock Exchange Premier Market

Fiscal Year-End

MarchType of Business

RetailNumber of Employees (consolidated) as of the
End of the Previous Fiscal Year

1,000 or more

Net Sales (consolidated) as of the End of thePrevious Fiscal Year100 billion yen or more but less than 1 trillion yen

Number of Consolidated Subsidiaries as of the
End of the Previous Fiscal Year

50 or more but less than 100

4. Policy on Measures to Protect Minority Shareholders in Conducting Transactions with Controlling-8-

[Translation]

Shareholder—

5. Other Special Circumstances Which May Have Material Impact on Corporate Governance<Group Management Views and Policies>
Based on the recognition that continuously building and maintaining an organizational structure that is able toswiftly respond to changes in the business environment is one of the key business issues for the Group, theCompany delegates authority and places the responsibility for managerial execution with each Group company
so that each company may manage its business with speed and autonomy in pursuit of maximum business results.
As a holding company, we also supervise each company’s business planning from the perspective of the Group’s
overall optimization and determine the efficient allocation of management resources such as capital and humanresources through continued monitoring and evaluation of the state of business execution.
<Significance of Having Listed Subsidiaries>
The Company is the parent company of listed subsidiaries, Trust Co., Ltd. (TSE Standard Market; Securities
Code: 3347) and AMG Holdings Co., Ltd. (TSE Standard Market, NSE Main Market; Securities Code: 8891).
Trust Co., Ltd. is involved in the used car export business, contributing to the Group by expanding its sales area
and increasing value added to its products. The company’s clients are largely overseas customers, and we believethat being listed helps garner trust from these overseas clients in particular.
AMG Holdings Co., Ltd. is involved in the housing-related business, contributing to the Group by not only
diversifying its fields of business but also helping develop our automotive businesses by building dealerships
through its subsidiaries. We believe that the company’s listing facilitates its access to information on real estate
projects and also enables its subsidiaries to engage in transactions that require creditworthiness.
In addition to the above, we also believe that keeping both companies as listed subsidiaries is important from theperspective of attracting capable human resources, improving management expertise, and developing acomprehensive administrative management system.
<Measures to Ensure the Effectiveness of Listed Subsidiaries’ Governance Systems>
As of the date of submission, AMG Holdings Co., Ltd. has appointed two (2) Independent Outside Directors outof its three (3) Directors who are Audit and Supervisory Committee Members, while Trust Co., Ltd. has appointed
two (2) Independent Outside Directors out of its seven (7) Directors and two (2) Independent Outside Audit &Supervisory Board Members out of its three (3) Audit & Supervisory Board Members. The Company believes
that both companies have secured systems to protect the rights of general shareholders and make independent
decisions.
In addition to the above, the Company has established and administers the Regulations for the Management of
VT Holdings Affiliates in order for the Company and Group companies to conduct business in an appropriate
and smooth manner, and for each Group company to exercise its autonomy while collaborating with the Company
to grow as a group. We have exempted our listed subsidiaries from the application of the provisions requiring
parent company approval with respect to matters such as resolutions of the Board of Directors, and believe that
we have ensured greater independence and autonomy for these subsidiaries than our non-listed subsidiaries.

-9-[Translation]

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

Company with Audit and Supervisory Committee[Directors]
Maximum Number of Directors Stipulated in
Articles of Incorporation Updated

18

Term of Office Stipulated in Articles ofIncorporation

1 yearChairperson of the Board

President

Number of Directors Updated

14

Appointment of Outside Directors

Appointed

Number of Outside Directors Updated

6

Number of Outside Directors Designated as
Independent Officers Updated

6

Outside Directors’ Relationship with the Company (1) Updated

Name

Attribute

Hisatake Yamada

LawyerMiki Shinjo

From another company

Mari Fujitani

Certified public
accountant
From another company

Masahisa Kato
Kazunori Shibata
Yuichi Kakura

Relationship with the Company*
a

b

c

d

e

f

g

h

i

j

k

Certified public
accountant
Lawyer* Categories for “Relationship with the Company”* “○” when the Director presently falls or has recently fallen under the category;“△” when the Director fell under the category in the past
* “●” when a close relative of the Director presently falls or has recently fallen under the category;“▲” when a close relative of the Director fell under the category in the past
a
b
c
d
e
f

Business executor of the Company or its subsidiaryBusiness executor or non-executive director of a parent company of the Company
Business executor of a fellow subsidiary of the Company
A party whose major business partner is the Company or a business executor thereof
Major business partner of the Company or a business executor thereof
Consultant, accountant, or legal professional who receives a large amount of monetary consideration orother property from the Company in addition to officer remunerationg Major shareholder of the Company (or a business executor thereof if the shareholder is a legal entity)h Business executor of a business partner of the Company (that does not fall under d, e, or f) (only the Director
himself/herself)
i Business executor of a company with which the Company mutually appoints outside officers (only the
Director himself/herself)- 10 -

[Translation]jBusiness executor of a company or organization that receives donations from the Company (only the
Director himself/herself)k Others

Outside Directors’ Relationship with the Company (2) Updated

Name

Hisatake Yamada

Miki Shinjo

Audit andSupervisory
Committee
MemberDesignationas
Independent
Officer○○

Supplementary Explanationof the Relationship—He has extensive experience and expertise as alawyer, as well as a strong commitment to legal
compliance, and has helped to strengthen thecompliance systems of the Company and Group
companies. He is expected to offer appropriate
advice and statements benefiting stakeholders on
the Board of Directors, etc. Accordingly, we havecontinuously appointed him as Outside Director.
Moreover, he satisfies the independence criteria
required of Independent Officers. The Company
has designated him as an Independent Officer
focusing on the protection of general shareholders
to have him provide accurate advice and supervise
the Company’s management from a fair and neutral
perspective as an Outside Director.

—

In her long career in the administrative divisions ofprimarily foreign-owned companies, she has
extensive experience in finance and accounting as
CFO, as well as wide-ranging knowledge with aninternational perspective. Accordingly, we haveappointed her as Outside Director based on the
judgment that she can appropriately supervise andprovide advice on the execution of duties by the
Directors, particularly from the viewpoint offinancial accounting, by utilizing her expertise inthis area.
Moreover, she satisfies the independence criteria
required of Independent Officers. The Company
has designated her as an Independent Officer
focusing on the protection of general shareholders
to have her provide accurate advice and supervise
the Company’s management from a fair and neutral
perspective as an Outside Director.

Mari Fujitani○

Reasons for Appointment—- 11 -She has extensive experience and wide-ranging
knowledge as an accountant and is expected tocontribute to enhancing the corporate governanceof the Company and Group companies, as well as
strengthening the supervisory function and ensuring
the transparency of the Board of Directors.
Accordingly, we have appointed her as Outside
Director. Moreover, she satisfies the independence
criteria required of Independent Officers. The
Company has designated her as an Independent
Officer focusing on the protection of generalshareholders to have her provide accurate advice
and supervise the Company’s management from afair and neutral perspective as an Outside Director.

[Translation]
He has played a leading role for listed companies inareas of the Companies Act and stock
administration for many years in his career, and heis well versed in corporate governance, an area thathas been increasingly emphasized in recent years.
Accordingly, we have appointed him as Outside
Director based on the judgment that he will leveragesuch experience and knowledge to strengthen theaudit system of the Company. Moreover, hesatisfies the independence criteria required ofIndependent Officers. The Company has designatedhim as an Independent Officer focusing on theprotection of general shareholders to have him
provide accurate advice and supervise theCompany’s management from a fair and neutral
perspective as an Outside Director.

Masahisa Kato○

Kazunori Shibata

Yuichi Kakura

○

○

○

○

○

—

He has worked as a certified public accountant for
many years and has extensive knowledge andexperience in finance, accounting, and taxes. Using
his expertise based on his knowledge andexperience, he has provided appropriate advice andrecommendations that contribute to maintaining
and strengthening the Company’s corporate
governance.
Moreover,hesatisfies
theindependence criteria required of Independent
Officers. The Company has designated him as an
Independent Officer focusing on the protection ofgeneral shareholders to have him provide accurate
advice and supervise the Company’s managementfrom a fair and neutral perspective as an Outside
Director.

—

He has contributed to maintaining and enhancing
the Company’s compliance and corporate
governance based on his extensive knowledge andexperience as a lawyer. Accordingly, we haveappointed him as Outside Director based on the
judgment that his high degree of expertise makes
him essential in ensuring the legality of theCompany’s management decisions. Moreover, hesatisfies the independence criteria required ofIndependent Officers. The Company has designatedhim as an Independent Officer focusing on theprotection of general shareholders to have him
provide accurate advice and supervise theCompany’s management from a fair and neutral
perspective as an Outside Director.

—[Audit and Supervisory Committee]
Committee’s Composition and Attributes of Chairperson Updated

Audit andSupervisory
Committee

All Committee
Members4

Full-timeMembers2

Appointment of Directors and employees to assist with

Inside Directors
1

Not appointed- 12 -

OutsideDirectors
3

Chairperson
Inside Director

[Translation]
the duties of the Audit and Supervisory Committee
UpdatedReason for Adoption of the Current Corporate Governance System Updated
The Audit and Supervisory Committee has not appointed any employee to assist with the duties of the Audit andSupervisory Committee as information is collected through Directors who are Full-time Audit and Supervisory
Committee Members or through collaboration with the Internal Audit and Supervisory Office, which is an internal audit
department, and Accounting Auditor. If the Audit and Supervisory Committee requests that an employee be appointed toassist with the duties thereof, the Company shall assign the necessary personnel to do so.
Collaboration Among the Audit and Supervisory Committee, Accounting Auditor, and Internal Audit
Department Updated
The Company holds quarterly three-way audit meetings conducted by its Audit and Supervisory Committee, Accounting
Auditor, and Internal Audit and Supervisory Office, during which Audit and Supervisory Committee receives reports
from the Accounting Auditor and Internal Audit and Supervisory Office on their plans, details on the implementation
thereof, and said results. The Audit and Supervisory Committee, meanwhile, provides both other parties with
explanations on its audit policies and audit plans and provides and exchanges information as appropriate. In this way, theCompany strives to ensure mutual collaboration in its internal audits, Audit and Supervisory Committee audits, andaccounting audits.
Full-time Audit and Supervisory Committee Members strive to conduct audits more effectively and efficiently byexchanging information with the Accounting Auditor as necessary and appropriate and by cooperating with the
Accounting Auditor to conduct audits in its presence and on the internal control system.
The Internal Audit and Supervisory Office, which reports directly to the President & CEO, formulates its internal audit
policy, internal audit implementation plans, and the details of its internal audits each fiscal year based on discussions
with Audit and Supervisory Committee Members and shares information on and its recognition of priority issues. It thenreports to and exchanges opinions with the Audit and Supervisory Committee on the implementation status and results of
its internal audits. In doing so, the Internal Audit and Supervisory Office works together to enhance the effectiveness andefficiency of the Company’s audit function. In addition, Audit and Supervisory Committee Members selected by the
Audit and Supervisory Committee accompany internal audit activities to more accurately grasp the current state of thebusiness, Audit and Supervisory Committee Members also interview the persons in charge on site, inspect documents,
and perform on-the-spot surveys to conduct audits more effectively.
Voluntary Establishment of Committee(s)Voluntary Establishment of Committee(s) Corresponding toNomination Committee or Remuneration Committee

Established

Committee’s Name, Composition, and Attributes of Chairperson Updated
Committee Corresponding toNomination Committee

Committee Corresponding to
Remuneration Committee

Committee Name

Nomination and Remuneration
Committee

Nomination and Remuneration
Committee

All Committee Members

55

Full-time Members

22

Inside Directors

11Outside Directors

44Outside Experts

0

0

Other

0

0

Chairperson

Outside Director

Outside Director- 13 -

[Translation]

Supplementary Explanation Updated
The Company has voluntarily established the Nomination and Remuneration Committee as an advisory body to
the Board of Directors comprised of Independent Outside Directors as its principal members. The purpose of theCommittee is to strengthen the independence, objectivity, and accountability of the Board of Directors pertaining
to the nomination (including succession planning) of and remuneration for senior management and Directors.
The members and chairperson of the Nomination and Remuneration Committee shall be appointed by resolutionof the Board of Directors. The Committee shall consist of at least three (3) Outside Officers and may also
include Inside Directors as necessary. The Committee currently consists of four (4) Independent Outside
Directors and one (1) Inside Director, with Independent Outside Directors comprising the majority. An
Independent Outside Director serves as the chairperson.
The Board of Directors consults with the Nomination and Remuneration Committee in advance on mattersrelated to nominations and remuneration, and makes decisions based on the Committee’s report to ensure its
proper involvement and counsel, including its perspectives on gender and other diversity-related matters as well
as skills.
[Independent Officers]
Number of Independent Officers Updated

6

Other Matters Relating to Independent Officers
The Company designates all Outside Directors who satisfy the criteria for Independent Officers as Independent
Officers.

[Incentives]
Implementation of Measures to Provide
Incentives to Directors

Not implemented

Supplementary Explanation for the Applicable Items
The Company discloses its policy as described in [Reasons for Non-compliance with the Principles of the
Corporate Governance Code]: [Supplementary Principle 4.2.1 Roles and Responsibilities of the Board (2)].
Recipients of Stock Options
Supplementary Explanation for Applicable Items―[Director Remuneration]
Disclosure of Individual Director Remuneration

No individual disclosure

Supplementary Explanation for the Applicable Items
Director and Audit & Supervisory Board Member remuneration for the fiscal year ended March 31, 2024 was
as follows. Remuneration for eight (8) Directors: 305 million yen
Remuneration for four (4) Audit & Supervisory Board Members: 24 million yen* The Director remuneration above includes provision for retirement benefits for directors (and other officers)of 52 million yen recorded for the fiscal year.
* The Audit & Supervisory Board Member remuneration above includes provision for retirement benefits for- 14 -

[Translation]
directors (and other officers) of 3 million yen recorded for the fiscal year.
* The remuneration paid to Directors does not include the portion of employee’s salary for Directors who
concurrently serve as employees.
Policy on Determining Remuneration Amounts
and Calculation Methods

Established

Disclosure of Policy on Determining Remuneration Amounts and Calculation Methods
The Company discloses its policy as specified in [Disclosure Based on the Principles of the Corporate GovernanceCode]: [Principle 3.1 Full Disclosure].
[Support System for Outside Directors] Updated
Outside Directors are provided with information and explanations on a regular basis of at least once per month(for one to two hours) in principle in conjunction with meetings of the Board of Directors.
We also believe that the level of remuneration for their services is appropriate taking into consideration theirvaluable advice and suggestions meant to further stimulate the Board of Directors and Audit and Supervisory
Committee, enhance the Company’s management, and increase transparency in management.

2. Matters on Functions of Business Execution, Auditing, Oversight, Nomination and Remuneration
Decisions (Overview of Current Corporate Governance Structure)
The Company has specifically established a system of corporate governance through the following management
functions in order to achieve transparency and fairness in management, separation between management decisionmaking and business execution, and an objective management oversight system while promoting thoroughcompliance.
1. Business Execution Function(Board of Directors)
The Board of Directors is comprised of fourteen (14) Directors (of whom six (6) are Independent Outside
Directors) chaired by the President & CEO. The Board ensures diversity in its composition by appointing
individuals with the skills and attributes necessary to oversee our Group companies engaged in an array ofbusinesses. In addition, the Company ensures that at least one-third of its Directors are Independent Outside
Directors to strengthen the supervisory function of the Board of Directors and maintain fairness andtransparency, and sets the term of office for Directors to one (1) year in order to clearly define their
management responsibilities.
The composition of the Board of Directors is outlined on our website (URL: https://www.vtholdings.co.jp/about/officers.html).
Furthermore, based on Article 427, paragraph 1 of the Companies Act, the Company has entered into anagreement with each Outside Director to limit his/her liability for damages under Article 423, paragraph 1 ofthat Act. The maximum amount of liability for damages based on the agreement will be the greater of 1 million
yen or the minimum limited liability provided for by laws and regulations.
(Nomination and Remuneration Committee)
The Company established the Nomination and Remuneration Committee in March 2022 as an advisory bodyto the Board of Directors. The members of the Nomination and Remuneration Committee shall consist of atleast three (3) Independent Outside Directors, and may also include Inside Directors as necessary.
The Nomination and Remuneration Committee receives consultations from the Board of Directors on mattersrelated to nominations and remuneration, deliberates on said matters, and provides a report to the Board of
Directors. The Board of Directors then makes its decision based on the report. In this way, the Nomination andRemuneration Committee’s involvement and advice helps ensure objectivity and fairness in the Board of
Directors’ decisions regarding Director nominations and remuneration.
As of the date of submission, Independent Outside Directors comprise the majority of the Nomination andRemuneration Committee’s members as follows, and an Independent Outside Director serves as thechairperson.
Chairperson: Hisatake Yamada (Independent Outside Director)- 15 -

[Translation]
Members: Miki Shinjo (Independent Outside Director), Mari Fujitani (Independent Outside Director),
Masahisa Kato (Independent Outside Director), Ichiro Yamauchi (Inside Director)(Other Committees, Etc.)〇 Group Strategy Committee
The Group Strategy Committee, which consists of the Company’s and each Group company’s management,
meets quarterly to examine projects important in managing the Group in a multifaceted approach and carefully
discuss them to ensure that the entire Group is unified in its decisions.
〇 Investment Committee
The Investment Committee, which serves as an advisory body to the Company’s Board of Directors, is chairedby an Outside Director and is comprised of other Outside Directors as well as outside experts including lawyers
and Certified Public Accountants as external members. Committee meetings are attended by the Company’s
Representative Director, Senior Managing Directors, Managing Directors, and Full-time Audit and Supervisory
Committee Members as requested. Meetings are held from time to time as necessary during which deliberations
are made ahead of meetings of the Board of Directors to determine whether the Company’s corporate
acquisitions and strategic partnerships are appropriate, reasonable, and consistent with the Basic Policy of theGroup from an independent standpoint based on the multifaceted expert viewpoints of each Committee
member.
〇 Group Risk Management Committee
The Company has established the Group Risk Management Committee chaired by and partly composed of theCompany’s Directors to properly manage risk throughout the entire Group and enhance corporate value. In
principle, the Committee meets twice a year to decide how to respond to material risks to the Groupmanagement and monitor the status of said response.
〇 Group Compliance Committee
To enable oversight of the Group compliance framework, the Group Compliance Committee has been
established. The Committee meets twice a year in principle to share information on compliance within theGroup as well as discuss important issues and form policies for each company, thereby promoting complianceacross the entire Group.
〇 Sustainability Committee
The Sustainability Committee has been established to actively and aggressively address issues surrounding
sustainability and make efforts to achieve the SDGs from the perspective of improving our medium- to longterm corporate value.
2. Audit and Supervisory Function(Audit and Supervisory Committee Member Audits)
Audit and Supervisory Committee Member audits are conducted based on the audit plan established by the
Audit and Supervisory Committee, which consists of two (2) Full-time Audit and Supervisory Committee
Members and two (2) Part-time Audit and Supervisory Committee Members (of whom three (3) are Outside
Directors) to ensure the legality and appropriateness of the Company’s business execution.
Kazunori Shibata, who is an Outside Director, has considerable knowledge of finance and accounting from his
experience as a Certified Public Accountant and Certified Public Tax Accountant. Yuichi Kakura, who is also
an Outside Director, has considerable knowledge of the law from his experience as a lawyer. In addition, Outside
Director Masahisa Kato has played a leading role for listed companies in areas of the Companies Act and stock
administration for many years and has wide-ranging experience and knowledge in corporate governance.
Inside Director Hirokazu Ando has served as a compliance promotion officer for the Company and the Groupfor many years and has wide-ranging experience and knowledge. The composition of the Audit and Supervisory
Committee is outlined on our website (URL: https://www.vt-holdings.co.jp/about/officers.html).
The Audit and Supervisory Committee monitors the overall status of the Company’s business execution byattending key meetings, receiving business reports from Directors, auditing the operations of affiliatecompanies, discussing the appropriateness of audit methods of the Accounting Auditor, and exchanging
information with the Internal Audit and Supervisory Office. The Audit and Supervisory Committee reports on
the results of audits at meetings of the Board of Directors and provides advice or recommendations forcorrective action.
Furthermore, based on Article 427, paragraph 1 of the Companies Act, the Company has entered into anagreement with each Audit and Supervisory Committee Member to limit his/her liability for damages under
Article 423, paragraph 1 of that Act. The maximum amount of liability for damages based on the agreement
will be the greater of 1 million yen or the minimum limited liability provided for by laws and regulations.
(Internal Audits)
Internal audits at the Company are conducted by the Internal Audit and Supervisory Office, an organization- 16 -

[Translation]that reports directly to the President & CEO comprised of two (2) members. It periodically audits the statusof the Company’s and Group companies’ business execution from the perspective of efficiency andcompliance with laws and regulations, the Articles of Incorporation, and internal regulations, and carries out
evaluations, makes proposals, and reports the results to the Board of Directors and Audit and Supervisory
Committee.
(Accounting Audits)
There are no special interests between the Company and its Accounting Auditor, Tokai Audit Corporation, orthe engagement partners engaged in audits of the Company. The Company has entered into an audit agreementwith the corporation, which the Company compensates based on the agreement. The names of the Certified
Public Accountants who performed services for the Company during the fiscal year ended March 31, 2024 are
as follows:
Hisataka Goto, Mitsuhiro Okuni, and Chihiro Achiwa, Representative and Engagement Partners of Tokai
Audit Corporation(Eight (8) other Certified Public Accountants, one (1) junior accountant, and one (1) other staff also assisted in theaudits)3. Determination of Remuneration
Remuneration for each Director (excluding Directors who are Audit and Supervisory Committee Members) isdetermined by the President & CEO, who has been entrusted by resolution of the Board of Directors with theauthority to do so, within the scope of the total amount approved at the general meeting of shareholders inaccordance with Principle 3.1 iii) of the Corporate Governance Code. To ensure that the President & CEO
exercises this authority in a proper fashion, the Board of Directors shall consult with the Nomination andRemuneration Committee on proposed remuneration and seek its report, based on which the President & CEO
is to make said determination.
Remuneration for each Audit and Supervisory Committee Member is determined based on discussions by the
Audit and Supervisory Committee Members within the scope of the total amount approved at the general
meeting of shareholders, taking into consideration the Company’s performance as well as each Audit andSupervisory Committee Member’s role and contributions.

3. Reasons for Adoption of Current Corporate Governance System
The Company has adopted its current corporate governance system as it believes that the appropriateness of theCompany’s operations is ensured by having Outside Directors with expert knowledge and a wide-ranging
experience who supervise business execution from an independent and objective standpoint, as well as Inside
Directors who are Full-time Audit and Supervisory Committee Members from the Company, who are well versedin the Group’s businesses, conduct respective audits in cooperation with the Accounting Auditor and its internal
audit departments.
The Company has appointed six (6) highly independent Outside Directors who comprise one-third of the Board of
Directors. These Outside Directors maintain close collaboration with the Audit and Supervisory Committee andalso serve as chairperson of the Investment Committee and the Nomination and Remuneration Committee theCompany has established, aiming to enhance the objectivity and transparency of management’s decision-making.

III. Implementation of Measures for Shareholders and Other Stakeholders
1. Measures to Vitalize the General Meeting of Shareholders and Facilitate the Exercise of Voting Rights
Exercise of Voting Rights by
Electromagnetic Means
Participation in Electronic
Voting Platform and Other
Efforts to Improve theEnvironment for Exercising
Voting Rights for Institutional
Investors
Provision of Convocation
Notice (Summary) in English

Supplementary Explanation
Shareholders are able to exercise their voting rights via the Internet byaccessing the website for exercising voting rights designated by theCompany from a computer, smartphone, or other device.

The Company uses the voting platform operated by ICJ, Inc.

English translations of our convocation notices (extract) are published on thevoting platform.
- 17 -

[Translation]

2. IR Activities
Supplementary Explanation

Preparation and Publication ofDisclosure Policy

We have established the IR Policy based on our Basic
Policy on Corporate Governance and published it on our
website (https://www.vt-holdings.co.jp/ir/policy.html).

Regular Investor Briefings forAnalysts and Institutional
Investors

The Company holds twice-a-year financial briefing
meetings during which the President & CEO provides
explanations and addresses questions. The presentationmaterials of financial results for these meetings are madepublic through the Company’s website. In addition, theCompany has held its financial briefing meetings online via
the Internet, archived videos of which are made available
for streaming or by other means in an effort to create
opportunities for more shareholders and potential
shareholders to deepen their understanding of theCompany.

Publication of IR Materials on
WebsiteWe publish our Summary of Consolidated Financial
Results, Timely Disclosure Materials, Presentation
Materials of Financial Results, and other materials on the
IR section of the Company’s website (https://www.vtholdings.co.jp/ir/index.html).

Establishment of an IR section(staff)Explanation
byRepresentativeYes

The section in charge is the Management Planning Groupof the Administration Department in the Management
Strategy Division.

3. Measures to Ensure Due Respect for Stakeholders
Supplementary Explanation
Stipulation of Internal
Regulations for Respecting the
Position of Stakeholders

We have established the Basic Policy on Corporate Governance which
views corporate governance as the basis of company activities in ensuringtransparency, soundness, swiftness, and efficiency in corporate management
and business execution for all stakeholders, stipulating that the Company
will respect the position of its stakeholders.

Environmental protection
activities, CSR activities, etc.

As part of our CSR activities, we provide humanitarian aid to Ukraine,
donate to the Nagoya University Foundation, and provide aid to victims of
the earthquake in Turkey and Syria.
We disclose information on our sustainability and CSR activities and otherinitiatives on the sustainability page of our website (https://sdgs.vtholdings.co.jp/eng/).

Development of Policies on
Information Provision to
Stakeholders

We have established the IR Policy based on our Basic Policy on Corporate
Governance and published it on our website (https://www.vtholdings.co.jp/ir/policy.html).

IV. Matters Related to the Internal Control System
1. Basic Views on the Internal Control System and Progress on System Development
The Company’s Board of Directors has adopted the following resolution regarding a system to ensure that
Directors are in compliance with laws and regulations and the Articles of Incorporation in executing their duties,
as well as other systems to ensure the appropriateness of the Company’s operations. The Company has developed
its internal systems based on this resolution.
- 18 -

[Translation]
1. System to ensure that Directors and employees are in compliance with laws and regulations and the Articles
of Incorporation in executing their duties(1) We have established the Group Code of Conduct and the Compliance Rules which are thoroughly
communicated to ensure that Directors and employees comply with laws and regulations and the Articles
of Incorporation.
(2) We have established the Compliance Promotion Office in order to promote compliance, which shallconduct trainings and other educational activities for Directors and employees in addition to preparing
related regulations. The Group Compliance Committee has also been established, chaired by the Officer incharge of compliance, which oversees and manages compliance efforts across the entire company.
(3) The Company has established a third-party whistleblower framework to allow for the early detection andcorrection of improper and illegal activity.
2. System for storing and managing information related to Directors’ execution of duties(1) Information and documents related to Directors’ execution of duties (“information on the execution ofduties”) shall be properly stored and managed in accordance with laws and relations as well as theCompany’s internal regulations under the responsibility of the Director and General Manager of the
Administration Division.
(2) The Director and General Manager of the Administration Division shall create a database of information on
the execution of duties related to important issues within the Company, and establish a system that enables
prompt search into the existence of said documents, etc. and the status of their storage.
3. Regulations and other systems for managing risk of loss
(1) The Company shall respond to risks that could have material impact on management by eliminating
potential risks, preventing their occurrence, and preventing their recurrence in accordance with the VT Risk
Management Regulations.
(2) The Company has established the Group Risk Management Committee, chaired by the Officer in charge ofrisk management, which shall manage risk for the entire Group, including subsidiaries, via the committees
and working groups that have been established for each type of risk.
(3) The Internal Audit and Supervisory Office, an organization that reports directly to the President & CEO,shall formulate audit plans and conduct internal audits in accordance with the Internal Audit Regulations,and shall report immediately to the President & CEO in the event that business execution activity that posesrisk of loss is discovered through internal audits.
4. System to ensure that Directors execute their duties efficiently(1) Each line of business shall work to achieve the goals of the annual plan and medium-term business plan
formulated based on the Company’s business principles. Business reports shall be made to periodicallyreview whether said business plans are progressing according to their original schedule.
(2) Applicable matters with regard to business execution shall be brought to the Board of Directors inaccordance with the Regulations on the Board of Directors, and sufficient materials on agenda items shallbe distributed to all Officers at the meeting of the Board of Directors based on the Company’s management
decision-making principles.
(3) Authority over day-to-day business execution shall be delegated according to the Regulations on
Administrative Authority, the Regulations on Division of Duties, and other rules. The persons in charge ateach level shall execute their duties in accordance with these regulations.
5. System to ensure the appropriateness of operations in the corporate group comprised of the Company and its
subsidiaries(1) The Company has established a system to have its subsidiaries report to it on matters pertaining to their
management and which requires the Company’s approval on important issues according to the Regulations
for the Management of VT Holdings Affiliates. The Company has also established a system for the early
detection and correction of improper and illegal activity as a corporate group by administering awhistleblower framework.
(2) The Company manages the risk of loss at each of its subsidiaries through the Group Risk Management
Committee as well as the committees and working groups that have been established for each type of risk.
(3) When necessary, Officers and/or employees of the Company shall assume the role of officer at subsidiaries
to enable the efficient execution of duties in a coordinated manner as a corporate group, and to provide
guidance and supervision to ensure the appropriateness of business operations.
(4) The Company has thoroughly communicated the Group Code of Conduct and the Compliance Rules it has- 19 -

[Translation]
stipulated to the Group, and by establishing the Group Compliance Committee as a Group-wideorganization, has developed a system to ensure compliance with laws and regulations, the Articles ofIncorporation, and other various rules and regulations.
(5) The Internal Audit and Supervisory Office, in collaboration with the Group’s internal audit departments,
shall ascertain the status of subsidiaries’ compliance with laws and regulations, the articles of incorporation,and other various rules and regulations.
6. Employees who have been requested by the Audit and Supervisory Committee to assist it in its duties, theindependence of said employees from Directors, and measures to ensure the effectiveness of instructions given
to said employees by the Audit and Supervisory Committee(1) Should an Audit & Supervisory Committee request that an employee assist it in its duties, the Company
shall assign the necessary personnel to do so.
(2) Authority to direct the said employee shall be deemed to be delegated to the Audit and Supervisory
Committee, and the appointment, transfer, and HR evaluation of the said employee shall require priorconsent from the Audit and Supervisory Committee.
7. System for filing a report with the Audit and Supervisory Committee and system to ensure that persons who
have filed such a report are not subject to disadvantageous treatment for filing said report(1) The Company’s Directors and employees shall promptly report the occurrence or possible occurrence ofany matter that may cause the Company material loss or the discovery of any illegal or improper conduct
by a Director or employee to the Audit and Supervisory Committee. In addition, should any director, audit& supervisory board member, or employee of a subsidiary, or any person who has been notified by them,
becomes aware of such fact, he/she shall promptly report said fact to the Company’s Audit and Supervisory
Committee.
(2) The Company’s Audit and Supervisory Committee Members selected by the Audit and Supervisory Committee
may request reports, explanations, or the submission of materials regarding the status of business execution
from Directors and employees of the Company and directors, audit & supervisory board members, andemployees of subsidiaries.
(3) Audit and Supervisory Committee Members shall receive reports on the Company’s important issues in atimely manner by attending key meetings such as the Management Meeting, and also regularly exchange
information with the audit & supervisory committee members of subsidiaries to receive reports onimportant issues of Group companies.
(4) The Company shall prohibit the disadvantageous treatment of any person who has filed a report as describedin the preceding paragraphs on the grounds of having filed said report.
8. Policy regarding the treatment of expenses and liabilities incurred by Audit and Supervisory Committee
Members in executing their duties
In order to ensure the effectiveness of audits, the Company shall allocate an annual budget for expenses
incurred in connection with the execution of Audit and Supervisory Committee Members’ duties and prepay
or reimburse expenses paid outside of the budget in accordance with laws and regulations. Audit andSupervisory Committee Members shall take due care to ensure efficiency and appropriateness when incurring
such expenses.
9. Other systems to ensure that Audit and Supervisory Committee Members perform audits effectively
The Board of Directors has established a system whereby Audit and Supervisory Committee Members may
attend meetings of the Board of Directors and other key meetings and shall provide regular opportunities forthem to exchange opinions with the President & CEO, the Internal Audit and Supervisory Office, and the
Accounting Auditor.

2. Basic Views on Eliminating Antisocial Forces and State of Related Efforts
1. In order to prevent damage caused by antisocial forces and eliminate said antisocial forces, the Company’sGroup Code of Conduct stipulates that the Company is “fully aware that giving in to the demands of antisocial
forces such as organized crime groups, corporate racketeers, and terrorist groups will ultimately encourageantisocial acts, and will take a firm stand against these antisocial forces to the best of its ability avoiding any
and all involvement.” The Company shall thoroughly communicate this stance to all Directors and employees.
2. Should unreasonable demands be made by antisocial forces, the Company shall organize a system necessary
to address the situation with the Compliance Promotion Office as the supervising department and respond incollaboration with external specialist organizations such as legal counsel, the police, and the Aichi Prefecture
Center for Removal of Criminal Organizations.
- 20 -

[Translation]

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

Not adopted

Supplementary Explanation—

2. Other Matters Concerning the Corporate Governance System□ Overview of Timely Disclosure System
The state of the Company’s internal system for the timely disclosure of corporate information is as follows.
Material facts about the Company and Group companies are reported to the Representative Director and the person
in charge of information handling, and material information is determined according to the applicable timely
disclosure rules and the relevant laws and regulations. Information that has been reported, discussed, and deemed tobe subject to disclosure by the Board of Directors or other organization in accordance with the Company’s internal
regulations is disclosed in a fair, timely, and appropriate manner.
Information for disclosure is identified and managed by the corporate planning departments, and then provided toinvestors in a fair manner by the Director and General Manager of the Administration Division, who is the person
in charge of information handling.
<Timing of Disclosures>
Material corporate information and financial information are promptly disclosed upon resolution or decision by the
Board of Directors or other organization. Information related to facts which have occurred is promptly disclosed
upon recognition of the fact after determining whether timely disclosure is necessary.
<Content of Disclosures>
The Company discloses sufficient information necessary for investors to make proper judgements, and strives toprovide accurate information based on the advice and opinions of its auditing firm regarding financial results.

- 21 -

[Translation]- 22 -