Sustainability at the ITOCHU Group

Society

Environment

S
Society85

GovernanceSustainability at the ITOCHU Group

Society

Environment

GovernanceLabor Practices: Employment and Benefits
Action Plan
Risks

Opportunities

Decline in labor productivity, loss of excellent humanresources, missed business opportunities, increase in healthrelated expenses, and other events that would result fromfailure to take appropriate measures, and others.

Improvement of labor productivity and health and motivation,
securing of excellent human resources, enhanced capability of
responding to changes and business opportunities, and otherevents that will result from the creation of a workplace thatprovides job satisfaction, and others.

SDGs
Targets

Issues toAddress

Co

Business
Area

Commitment

Specific Approach

Performance Indicators(Non-consolidated)

Degree of Progress<ITOCHU Corporation><ITOCHU Corporation>

FYE 2021: Reduce thePromote the morning focusedworking system.

Improving
operatingefficiency andaddressing theissue of longworking hours
through work
style reform

Human
HeadResources
quarters
Affairs

We willpromote awell-balanced
working styleand reduce
the total
number ofworking
hours, aiming
to improve
employeeengagement.

Conduct regular monitoring of
employees' work situations.
Promote work automation with IT
tools, including the robotic processannual average overtime
hours by at least 10%compared to the period prior
to the introduction of themorning-focused working
system.

automation (RPA), as well as mobile
work.

FYE 2021: Percentage of
employees who leave thePromote projects for improving theoperating efficiency at eachlater at 5% or fewer.

organization.

office building at 20:00 or
FYE 2021: Paid leaveacquisition rate at 70% or
higher.

<ITOCHU Group>
Efficient way of working, appropriate
working hours management, andeducational and awareness-raising
activities at the ITOCHU Group.

Rate of positive responses tothe "employee engagement"
item in the engagement
survey: 70% or higher.

We have reduced annual average overtime hours by 11%
compared to before the introduction of the morningfocused working system (achieved in FYE 2018).
We have 5% of employees leaving the building after 8
p.m. (FYE 2019).
We have 67% of employees acquiring paid leave (FYE
2019).
We plan to complete approximately 100 scenarios in FYE2019 for RPA. We will also introduce a data analysis tool
(HANABI). We are currently running 151 scenarios. (As of
February 2020)
In FYE 2019, we plan to implement BPR (business
improvement) at the organization level in three divisions(Fresh Food Division, Automobile, Construction Machinery& Industrial Machinery Division and Apparel Division).
The positive answer rate to the "Employee Engagement"
item from the FYE 2019 Engagement Survey was 76%.
*We did not conduct a survey in FYE 2020. The latest
data is for FYE 2019.

Policy and Basic Concept
In running a global business in a wide range of domains, consolidated group companies join together to operate as
the ITOCHU Group. ITOCHU has more than 120,000 consolidated employees as of the end of FYE 2020. ITOCHU isimplementing various initiatives that aim to optimize labor standards and create a working environment where ourdiverse body of employees can reach their full potential. Some of our notable initiatives include: the introduction ofa "work style reform" such as through morning shift systems and "Dress-down Days," the establishment of various
systems to support employees with caring duties, and the promotion of social activities among employees at ourrecreational facilities.

Structures and Systems
ITOCHU provides support to ITOCHU Group companies regardless of their area or field of operation to ensure that amanagement system is set in place to provide an optimal working environment for employees, at minimum
complying with local laws and regulations. ITOCHU Group companies have reporting lines aligning to each divisioncompany at ITOCHU in accordance with their business areas, and each division company is responsible forfollowing up on necessary measures to support its subsidiaries.

Risk Assessment for Labor Practices in Business Investments andFinancing Projects
When assessing potential investment and financing projects, in addition to economic aspects, ITOCHU uses an ESG
checklist to identify and assess key ESG (environmental, social, governance) concerns relevant to the project,which includes topics related to labor practices – e.g. working conditions, occupational health and safety andstakeholder dialogue. We also monitor the progress and performance of our existing investment and financing
projects and take necessary measures to make improvements.
For further details, please refer to the ESG Risk Assessment for New Business Investment Projects (P152).
86

Sustainability at the ITOCHU Group

Society

Environment

Governance

Ensuring Compliance to Labor Standards
At ITOCHU, it is mandatory for employees upon recruitment to complete training on working conditions, which
includes issues related to salary, working hours and holidays, occupational safety and health, benefits, andprohibited actions and behaviors. Additionally, we are taking necessary measures to align the labor standards ofour group subsidiaries to that of ITOCHU – these measures aim to elevate the baseline labor standards of our
subsidiaries. We also provide our subsidiaries with support regarding the enhancement and optimization of working
environments. Our labor standard expectations are published on the intranet in Japanese and English, which are
the common working languages of the ITOCHU Group, with aim to facilitate their implementation.

Employee Engagement
ITOCHU Corporation believes that raising the level of motivation, satisfaction and engagement (the degree to which
employees with a strong desire to contribute to ITOCHU can capitalize on their own abilities optimally at their own
initiative) of employees will improve the corporate value.
In the survey conducted in FYE 2019, the results exceeded those of the previous survey (conducted in FYE 2015)
especially for the question "ITOCHU shows care and concern for its employees". The positive answers were 10
points higher than the average of Japanese companies that conducted the survey (over 60 large companies).
Above all, the level of engagement remained high, which has allowed us to conclude that many employees areproud of working for ITOCHU Corporation and engage in work with strong motivation to contribute to the company
and with the aim of achieving better-than-expected results on a voluntary basis.

Promotion of Working-Style Reforms
ITOCHU Corporation believes that employees are its greatest asset, and that the full exertion of each individual
employee's capabilities will lead to an improvement in corporate value. Based on this belief, ITOCHU has pursued arange of initiatives to develop environments where all employees can utilize their respective characteristics andconcentrate on work at ease. The morning-focused working style, which we introduced in October 2013 as ameasure for working-style reforms, has greatly influenced the government and many companies. More than six
years after its introduction, it continues to give the results steadily as the core element of the company's workingstyle reforms. In June 2017 we implemented a "Dress-down Days" initiative to as a new approach to our work stylereform to establish a non-confining work environment where each and every employee is encouraged todemonstrate their individual strengths. In August 2017, we introduced initiatives to support balancing cancer careand work to create a workplace in which all employees, regardless of whether they suffer from cancer or long-term
illness, can continue to work without concern toward their fullest potential all the while maintaining motivation andfinding meaning in their work. As the leading company in "working-style reforms" and "Health and Productivity
Management, ITOCHU will continue to implement a range of initiatives in a pioneering manner to establish anenvironment where employees find it worthwhile to work for the company.

87

Sustainability at the ITOCHU Group

Society

Environment

GovernanceWorking Hours Management / Morning-Focused Work
Not only do we comply with legislation like the 36 Agreement, but we are focusing on work-style reform aimed at
reducing total number of hours worked.
ITOCHU has long sought to reduce overtime work from a perspective of managing employee health and promoting
effective operations. To achieve a more effective working style, we reconsidered the way of thinking that assumes
employee will work overtime and determined that a shift in employee awareness was needed. So in October 2013
we introduced a morning-focused work system intended to help shift work habits from night-focused to morningfocused. This progressive approach has impacted not just the industrial world, but the political and businessestablishment as well. It has grown into a large movement that is changing the way Japanese people work. Morethan six years after its introduction, the approach continues to produce steady results and is the core element in
our work-style reforms.
ITOCHU believes its initiatives as a pioneer in work-style reform will both empower individual employees to change
their approach to work, and promote balanced operational reforms. In this way, the Company is striving to achievea work environment that enhances operational effectiveness, helps maintain and improve employee health, support
the activities of employees who face time constraints from raising children or caring for family members in poor
health and allows a more diverse set of employees to make full use of their capabilities.

Outline of Initiatives
Night work (10 p.m. - 5 a.m.) is prohibited. Working between 8 p.m. and 10 p.m. is prohibited in principle.
However, work after 8 p.m. may be allowed in special circumstances after prior approval if it is unavoidable.
We pay increased wages at the same rate as for night work to encourage employees to work earlier in themorning (5 a.m. - 8 a.m.)(employees subject to time management: 150%; employees not subject to time
management: 25%).
We also provide light meals to employees who begin work before 8 a.m. to aid in managing their health.
Morning-Focused Work System Diagram

Providing light meals to
employees

Effects of Initiatives
Prior toFirst Year after

Five Years after

Introduction

Introduction

Introduction

8:00 p.m. or later

Approx. 30%

Approx. 7%

Approx. 5％(10:00 p.m. or later)(Approx. 10％)

(Almost 0)(Almost 0)

8:00 a.m. or before

Approx. 20%

Approx. 34%

Approx. 44%–

Approx. 7% decrease

Approx. 11% decrease

Left bldg.

Entered bldg.

Hours of overtime per person

88Sustainability at the ITOCHU Group

Society

Environment

Governance

Dress-down Days
On the specific days of the week are designated "Dress-down Days," and employees are allowed to dress downeven more than they could during the previous Casual Fridays. In lieu of business suits, they can wear what thelike as long as it can be considered "work clothes" suitable for business settings. Employees may even wear jeans
and sneakers, and are encouraged to wear outfits that express the freedom characteristic of ITOCHU. This programaims to have employees consider how best to dress down with consideration for their relationships with customers
and the people around them. This will develop their ability to think flexibly and foster a workplace environment thatfacilitates the creation of new ideas. The following key measures were implemented in FYE 2018 to increase
employee awareness of the program and encourage its spread. We have implemented the following as
representative measures since its introduction in FYE 2018 to educate and enlighten employees.

FYE 2018
A program in which personal stylists give 10 or so employees a complete makeover and get them to try newstyles. The program is conducted three times a year (summer, autumn/winter and spring) in cooperation of
Isetan Shinjuku Store of Isetan Mitsukoshi Ltd.
Internal company events that invite employees to wear a specific item ("Jeans Day" and "Sneakers Day", etc.)
and which involve related events on the same day. These could be sales, lectures by stylists on dressing well,etc. in cooperation with ITOCHU Group/associated companies.

FYE 2019
We have established a new permanent concept space called the "D+ Lounge" just for Dress-down Days on thesecond floor of the Tokyo Headquarters. This space offers events relating to personal appearance every month
to refine the power of expression of our employees. These events include personal color diagnoses, stylist
consultations, shoe shining, first-class shaving experiences and make-up lectures for working women.

FYE 2020
We have established Dress-down Every Day to enable employees to think about what clothes to wear to work in
response to the time, place and occasion (TPO) and the weather every day only in the summer (May to August).
Every day during this period is a Dress-down Days regardless of the day of the week.
We hold posture correction events with stretching in the D+Lounge and sales events for employees with thecooperation of ITOCHU’s group companies and business partners.

FYE 2021
We have further evolved this initiative as Dress-down Days four days a week from Tuesday to Friday.
* Applies to both full-time and part-time employees.

Balancing Work with Childcare and Nursing Care
ITOCHU Corporation goes above and beyond the requirements of the law to arrange programs available to bothmale and female employees that help them balance work with their childcare and nursing care obligations. This
allows employees to continue making full use of their skills during their careers at the company, while resting
assured they can handle stages of life where they must take care of children or elderly family members at home.
Over 50 male employees have been taking childcare leave a year since FYE 2016, so the use of this system has
become established. Meanwhile, in FYE 2017 we trialed a telecommuting program for employees raising children or
providing nursing care at home. This was followed in FYE 2018 by the official introduction of a telecommuting
program which employees who meet certain conditions can take advantage of. Eligible employees include thosewith time constraints due to childcare or nursing care obligations, as well as those who face difficulty making thecommute to work due to pregnancy, illness or other such reasons. We continue to hold nursing care seminars every
year in light of the fact the importance of preparing for nursing care has also become a social problem. At the sametime, we introduced a service to provide nursing care information online in FYE 2018. We then introduced a onestop nursing care assistance service to meet the needs of those seeking advice in April 2019.
89

Sustainability at the ITOCHU Group

Society

Environment

GovernanceSupport Programs for Balancing Work with Childcare & Nursing Care
Support for Childcare

Support for Nursing Care90

Sustainability at the ITOCHU Group

Society

Environment

GovernanceUse of Childcare & Nursing Care Programs
Use of Childcare & Nursing Care Programs★

(Unit: people)

FYE 2018
Men

Childcare

Women

Total

Men

FYE 2020

Women

Total

Men

Women

Total

Childcare leave

57

76

133

52

100

152

59

109

168

Leave to nurse sickchildren

65

123

188

66

124

190

74

139

213

Shorter working
hours for childcare

0

79

79

1

84

85

0

97

97

Special parental
leave

12

36

48

14

42

56

6

47

53

Percentage of
employees
returning to work*

Nursing CareFYE 2019

97%

97%

98%

Nursing care leave

1

0

1

1

0

1

1

0

1

Special nursing
care leave

2

4

6

0

8

8

3

10

13

Leave for nursing
care

17

36

53

16

44

60

29

42

71

Shorter working
hours for nursing
care

0

10

10

0

4

4

0

2

2

122

108

230

130

95

225

96

96

192

Family Support Leave* The percentage of employees returning to work after childcare leave is calculated according to the following formula︓
the number of employees returning to work after childcare leave during the current or the following fiscal year/thenumber of employees who finished taking childcare leave during the current fiscal year.

★Data assured by KPMG AZSA Sustainability Co., Ltd, an external assurance provider based on the international
standard ISAE 3000. (P216)

ITOCHU Kids Day for Visiting Mom & Dad at Work
Since 2014, we have regularly invited employees' elementary-age
children to ITOCHU Kids Day for Visiting Mom & Dad at Work. The
children get business cards made especially for the event, which theyexchange with employees at their parents' workplaces. They also attend
a mock meeting in the executive meeting room and eat lunch in theemployee cafeteria. These activities provide the children with a deeper
understanding of the company where their parents work. The response
from employees has been very positive for instilling an interest in what
the children's parents do at their job and for sparking a desire to workat ITOCHU in the future. As we consider this an incredibly meaningful
event for building family bonds and teaching children about ITOCHU, weplan to continue holding it.

91

Children exchange business cards with
the President COO

Sustainability at the ITOCHU Group

Society

Environment

Governance

Employee Benefits
ITOCHU Corporation employs a variety of welfare facilities and schemes to stimulate communication between
employees and provide opportunities for exchange. Stimulating communication helps foster a sense of belonging
and job satisfaction in individual employees. It also helps to invigorate the organization as a whole.

Employee Cafeteria
The employee cafeteria at the Tokyo Headquarters underwent large-scale renovations in May 2013 thattransformed it into a brighter and a more comfortable meeting place. Since then we have taken further steps tomake the cafeteria a more attractive space for employees. These include introducing a Wellness Cafeteria menu
created under the supervision of Kagawa Nutrition University* which aims to help employees improve their health.
We have also revised our menus and altered the layout of the room based on employee feedback. Nearly 1,600
people use the employee cafeteria every day.
This special cafeteria can also be used to share meals with customers, and operates as a pub at night. It has aregular Happy Hour, during which alcoholic beverages are available for free or at a discount. This boosts
communication between people from both inside and outside the company. In 2017, the menu was fully revised
and the cafeteria underwent major renovations once again. This has made it a great place for employees tointeract over meals.
* Kagawa Nutrition University is a pioneering force in nutrition education. The menu it helped create focuses on
daily specials with healthy dishes that fulfill different nutritional requirements. These include an energy value ofaround 600 kcal, salt content of 3 g or less, and vegetable servings of 140 g or more.
* Can be used by both full-time and part-time employees

Cooldown Rooms
In June 2012, ITOCHU Corporation introduced Cooldown Rooms on the first floor and first basement floor of its
Tokyo Headquarters. These rooms seek to help beat the summer heat by keeping visitors comfortable inside thebuilding and giving employees a comfortable place to work. To help fight global warming and save electricity insummer when demand for power is high, ITOCHU stipulates that air conditioners in the building not be set lower
than 28 degrees Celsius. However, the Cooldown Rooms have lower ceilings than other rooms and can be cooled
more efficiently. Cool air is supplied at 15 degrees Celsius to keep room temperature below 20 degrees. This makes
them great spaces for visitors to the building and employees returning from sales activities to cool down on hot
summer days. We also established a permanent history exhibition corner called "ITOCHU History" so that many
people can learn about the founding principles of our company while effectively utilizing the Cooldown Rooms.
* Can be used by both full-time and part-time employees

Shower Lounge and Shower RoomIn the summer of 2016, ITOCHU installed a shower lounge on the third floor of ourTokyo Headquarters, and a shower room on the second basement floor. Their goal is tohelp create a workplace environment that encourages job satisfaction. The seeds ofthis idea were accounts from employees who often found airport shower rooms
crowded when returning from business trips on early morning flights. Many reported
using external facilities (such as gyms and saunas) on their way to work. In responseto this feedback, ITOCHU established shower facilities at Headquarters so that
employees returning from business trips can be more comfortable as they begin work. The facilities are equippedwith overhead shower heads, which warm the body quickly in winter, and amenities like towels, hair driers,
shampoo, and conditioner. The facilities have been well received, with employees reporting they are able to work in
comfort. In response to employee requests, the facilities now stay open longer and can also be used by employees
who exercise to improve their health. They are also open to employees of affiliate companies.
* Can be used by both full-time and part-time employees

92

Sustainability at the ITOCHU Group

Society

Environment

Governance

The Hiyoshi Dormitory
In March 2018, ITOCHU Corporation opened the Hiyoshi Dormitory in the Kohoku ward of Yokohama, Kanagawa
prefecture. The dormitory has approx. 360 units to house unmarried employees. It brings together unmarried male
employees who had been scattered across four locations in the Tokyo Metropolitan area. The design concept for thedormitory is "under the same roof," as opposed to positioning it as a mere welfare facility. Accordingly, it isequipped with a variety of common areas designed to bring residents together and deepen communication acrossboundaries like age and department. These include a dining room with shared kitchen, a multi-purpose meeting
room, a large bathroom with a sauna, and communication spaces on each floor (including study areas and an open
terrace).
It also incorporates measures that take into account Health and Productivity Management. The cafeteria provides
breakfasts and dinners that take into account a nutritional balance from the viewpoint of policies such as healthand productivity management. We have also partnered with a local fitness club to give residents opportunities toexercise. As a rule, smoking is prohibited throughout the dormitory, including private rooms, and is only allowed indesignated smoking areas. We also provide a program that utilizes a smartphone app to assist those who wish toquit smoking. Through initiatives like these, we hope to create an environment that encourages employees tovoluntarily reform their work-style and improve their health.
This dormitory is designed to function as a secondary office for the Tokyo Headquarters and is vital to our business
continuity plan (BCP) for disasters. It uses the same Internet environment as our offices and we have installed
emergency generator equipment. We have also stocked the dormitory with food, water, emergency supplies andother items.
* Intended only for full-time employees"SOGO-KAI" Associations"SOGO-KAI" associations are groups where fellow employees can assemble to enjoy the same sports or culturalactivities. Spreading out from Tokyo and Osaka, there are more than thirty such associations active within thecompany nationwide. They boast a combined membership of more than 1,200 employees. The associations are notlimited to current ITOCHU Corporation employees. Many former employees and Group company employees also
take part. These associations use sports and cultural activities to promote exchange and communication acrossdifferent generations and organizations.
* Both full-time and part-time employees can join

Employment and Benefits Data
Employee Status★ (as of March 31 for each respective year)
Non-consolidated

Consolidated
Avg.

Employees

Men

Women

Avg. Age

AnnualSalaryEmployees

Temporary
Staff

(Yen)
2020

4,261

3,267

994

42

15,657,603

128,146

46,567

2019

4,285

3,283

1,002

42

15,207,832

119,796

38,721

2018

4,285

3,284

1,001

42

14,609,151

102,086

29,97693

Sustainability at the ITOCHU Group

Society

Environment

Governance

Employees by Operating Segment★ (as of March 31, 2020)(Unit: people)
Energy &Chemicals

GeneralProducts&
RealtyICT &FinancialBusiness

The 8thOthersTextileMachinery

Metals &Minerals

Nonconsolidated

385

456

170

327

440

262

193

43

1,001

3,277

Consolidated

7,869

13,842

501

12,68838,494

17,53020,392

13,9992,831

128,146

Food

Total

Overseas Bloc Employees by Region★ (as of March 31, 2020)(Unit: people)
North
America

Latin
America

EuropeMiddleEast

AfricaAsia &
Oceania

East Asia

CIS

National Staff

131

141

233

60

124

630

624

82

Rotational
Staff

55

29

48

14

21

78

108

16

Overseas
Trainees

14

5

8

3

3

15

23

1
2,466

TOTAL

* Employees assigned to overseas subsidiaries and overseas branches/offices* Regarding range of tallied data, figures not labeled as Consolidated are placed under Non-consolidated.
* Overseas bloc employees by region counts employees who are assigned to overseas subsidiaries oroverseas branches/offices.

Turnover — Non-Consolidated Employees*★
FYE 2017

FYE 2018

FYE 2019

FYE 2020

Voluntary resignation rate

1.2%

1.6%

1.7%

1.6%

Avg. Years Employed

16.9

17.3

17.5

17.8

* Positions: career-track, clerical, special
Turnover rate is calculated according to the following formula.
voluntary resignations ÷ employees at end of fiscal year
ITOCHU Corporation has a long average number of years employed of 17 years and only around 2% of employees
voluntarily resign. It is a company where many employees choose to stay for the long-term.
★Data assured by KPMG AZSA Sustainability Co., Ltd, an external assurance provider based on the international
standard ISAE 3000. (P216)

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Sustainability at the ITOCHU Group

Society

Environment

GovernanceLabor Practices: Labor Union
Policy and Basic Concept
ITOCHU Corporation hopes to achieve an environment in which employees can leverage their individual talents andconcentrate on their work without worry. To this end, we maintain a system of rich employee benefits andemployee welfare facilities. Our original employee welfare measures include a morning-focused work style, healthmanagement, support for living with cancer and dress-down day. These have met with praise both inside andoutside the company, and have contributed to increased employee motivation.
ITOCHU has established a labor union with which we hold constructive discussions to improve the working
conditions as well as economic status of its constituents.
* See "Employee Benefits (P92-93)" for details on the primary employee benefits that have been introduced andexpanded in recent years (for both full-time and part-time employees).

Targets
We are aiming for a 70% or higher rate of positive responses to the "employee engagement" items on our
engagement survey.
FYE 2021: Reduce the annual average overtime hours by at least 10% compared to the period prior to theintroduction of the morning-focused working system.
FYE 2021: Paid leave acquisition rate at 70% or higher.
FYE 2021: use stress checks to keep rate of high stress individuals below 5%.

Structures and Systems
ITOCHU Corporation has had a labor union since its founding. The objective of the Labor Union is to improve labor
conditions and other economic concerns of its members. The Labor Union carries out all required operations tofulfill this objective.
(Article 3, Rules of the ITOCHU Labor Union)
Headquarters: General meeting of delegates and officers at headquarters
Branch: Six branches (Tokyo, Osaka, Nagoya, Tohoku, Hokuriku and Kyushu)

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Sustainability at the ITOCHU Group

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Environment

GovernanceThe company is prohibited from taking any of the following actions:
1. Providing disadvantageous treatment to a worker because the worker is aunion member, or on similar grounds
Example: Discharging or transferring a worker because the worker has goneon strike as a union member, or on similar grounds
2. Refusing to bargain collectively without justifiable cause
Example: Refusing to come to the bargaining table or sending someone
without authority as a representative to attend a collective bargaining session
as a representative
3. Interfering with or providing financial assistance for the organization or
Ratio of ITOCHU Labor Union
members as of April 1, 2020

operation of a labor union
Example: Interfering with or interrupting the union's events or providing
financial support for union operational expenses
4. Providing disadvantageous treatment, such as dismissal, to a worker in
response to an allegation made by the worker to the Labor Relations
Commission
Example: Providing treatment, such as dismissal or wage reduction, to aworker in response to an allegation made by the worker to the Labor
Relations Commission, or to a similar action by the worker

Initiatives Together With ITOCHU Labor

Activities by the Headquarters of the Labor

Union in FYE 2020

Union in FYE 2020

April 2019 toMarch 2020

April 2019 to
Health Committee

March 2020

(monthly)
June
September 2019,
March 2020

November 2019,
January 2020

February 2020

General Meeting of Officers(twice a week)
Account settlement meeting

April, June

Labor-management

General Meeting of Delegates
Meeting attended by three top-committee for timeJulymanagement

ranking officers from eachbranchManagement meeting with

July,

Overseas Life Fact-Finding

the Division Company

DecemberInvestigation

President
SeptemberLabor-management
committee for salary

96

Labor Union event at Tokyo
Disney Land

October to

Influenza Vaccination Expense

December

SubsidySustainability at the ITOCHU Group

Society

Environment

GovernanceComments from the ITOCHU Labor Union President
My name is Masato Ikehata. I joined ITOCHU in 2003 and I will now serve as the
ITOCHU Labor Union President in FYE 2021.
FYE 2021 has been marked by the beginning of upheaval. This includes the spread ofcoronavirus infections around the world and a large drop in crude oil prices. The global
economy has rapidly entered a recession. There has also been a huge impact on the
trading company industry.

Masato Ikehata
President,
ITOCHU Labor
Union

In addition, our daily lives have been changing in a major way (e.g., self-restraint on
going out and telecommuting). Inevitably, changes in our work styles are required.
Under such circumstances, I imagine the responsibilities and expected roles thatshould be performed by the ITOCHU Labor Union will also change. I, together with all
the officers at the headquarters, will perform my duties with a sense of crisis.
I have organized the missions, action guidelines and vision of the labor union below, so
please read about them.
Missions of the Union (= the Meaning of the Existence of the Union and theValues at the Basis of Our Activities):"To protect our members" and "To build a good company"
Action Guidelines (= the Key Phrases We Value in Our Daily Work):
Stay Ahead: Proactively adopt advanced concepts and work styles to constantly
strengthen the organization
Speak Up: Strengthen the ability to speak up and inform everyone about theactivities of the union to gain a correct understanding
Be Reliable: Build a relationship of trust with union members and use that as thebasis to perform activities with a sense of unity
Vision (= Ideal Future State):
We are aiming to achieve a virtuous cycle of corporate management by improving
the labor environment and the economic status of our members.
((1) An improvement in the labor environment thanks to the activities of the union
accelerates the virtuous cycle of (2) active participation by union members, (3)improved company performance, (4) improved employee treatment, (5) improved
morale and then back to (2) again)

We will aim to achieve treatment and an environment suitable for a top trading
company both in name and substance under the two missions of the union to protect
union members and to build a good company. Under that aim, we hold negotiations
and discussions with the company.
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Sustainability at the ITOCHU Group

Society

Environment

GovernanceDialogs with the Labor Union
ITOCHU Corporation discusses a wide range of issues with the ITOCHU Labor Union in order to achieve ourcorporate mission "Sampo-yoshi." We held a total of six sessions of settlement of accountings meetings with the
CFO, management meetings with the the Division Company President settlement of accountings meetings with the
CFO and other collective bargaining and labor-management committee meetings in FYE 2020. Recurrent, active
discussion between labor and management makes both cognizant of the challenges facing the company and keeps
them on the same page. This builds a healthy relationship that enables them to consider and implement measures
for improvement.

Dialogs with the President
ITOCHU proactively establishes opportunities for the President and employees to engage in direct two-way
dialogue. The President visited approximately 30 Japanese and overseas branches, local subsidiaries and groupcompanies where opportunities for dialogue with the President are usually limited to hold dialogue meetings in FYE
2020. The President personally conveyed the management policy and his passion toward the realization of that
directly to employees in these dialogue meetings. At the same time, the employees were also able to directly
express their own opinions and ask questions to the President. Therefore, these were valuable opportunities todeepen two-way communication. The content of these meetings is wide-ranging - even including private matters in
addition to the management policy. Accordingly, these are always extremely lively meetings.

Dialogs with the Division Company President
ITOCHU proactively establishes opportunities for the company president and corporate officers to engage indialogue with employees. Normally, all the employees under the control of an organization are gathered together
once every half a year. The top management of that organization then speaks in their own words about thecompany-wide management policy, organization targets and strategies toward target achievement. It is possible
for employees to give their opinions and ask questions at these dialogue meetings. These are valuable
opportunities for all employees, including the top management, to think about what we should personally do tofurther grow the organizations to which we belong.

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Sustainability at the ITOCHU Group

Society

Environment

GovernanceLabor Practices: Diversity
Action Plan
SDGs

Issues toTargets

Address

Co

Business
Area

Commitment

Specific Approach

Performance Indicators

Continue fair and equitable recruitment

The percentage of female career-track

and promotion.

employees among all career-track
employees is 9.7% (as of January 2020).

Create a work climate of mutual respect

Creating anenvironment thatallows diverse
human resources
to exercise theirpotential

Human
HeadResources
quarters
Affairs

We will prohibit all typesof discrimination,
including those based onage, gender andnationality, and respecthuman rights. We will
create an environmentthat will permit theactive participation of
employees whose work
hours are limited due tochildcare, nursing care,diseases or similar
circumstances.

Degree of Progress(Non-consolidated)and support.
Reasonable accommodations concerning
the work environment of people withdisabilities.
Respond to LGBT considerations andprovide employee training on LGBT.
Enhance on-site day-care centers andnursing care support services.
Enhance individual support for
employees provided in accordance with
their life stage and career.
Promote flexible ways of working by
making use of mobile work.
Support the active participation of seniorhuman resources over 65 years old.

FYE 2021: Percentage offemale career-track
employees among all careertrack employees: 10%.
FYE 2021: Percentage offemale career-track
employees among
employees in leadership
positions at 10%.
FYE 2021: Proportion of ourworkforce with disabilities at
2.3%.

The percentage of female career-track
employees among those in leadership
positions is over 8.1% (as of January2020).
Proportion of our workforce withdisabilities: 2.16% as of February 2020
(insufficient by one person)
We have been applying to make IHGS
applicable as a special subsidiary in ourgroup since February 2020. We achieved
the required number of hires as ofFebruary 2020 in the three companies of
ITOCHU, Uneedus and IHGS. We willcontinue to promote the employment of
those with disabilities over our entire
group.

Policy and Basic Concept
Amid intensifying global competition, ITOCHU Corporation believes that organizational diversity is essential if weare to provide direct answers to the diverse needs of the market and continuously create new business and added
value.
ITOCHU Corporation respects human rights and prohibits all forms of discrimination, including that based on race,
religion, age, gender and nationality. ITOCHU Corporation uses diversity seminars and organization manager
training to publicize the tools available to employees and to raise awareness about the importance ofcommunication. We do this so that they do not fall victim to power harassment* or sexual harassment (including
unfairly disadvantaging, engaging in hateful speech against or otherwise harassing employees who are sexual
minorities). Another reason is so that pregnant employees and those who are doing their best to balance work
while raising children or providing nursing care at home can feel their contributions to the workplace areworthwhile.
With regard to employees facing the constraints imposed by child-rearing or caring for a family member at home,superiors encourage them to make good use of the tools provided by the company to strike an appropriate worklife balance, while the company makes it known that it is also important to review the work duties, responsibilities
and work arrangements for the workplace as a whole. Additionally, the company makes thorough initiatives toprovide a workplace environment where discriminatory remarks about sexual orientation/gender identity andcomments premised on subconscious gender stereotypes are not tolerated. Employees also have access toconsultation services.
* Acts toward a co-worker in the same workplace that utilize the perpetrator's superior position or advantageousinterpersonal relationships (or other aspects of the workplace), thereby causing psychological or physicaldistress, or degrading the workplace environment, in a way that goes beyond the appropriate bounds of workduties.

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Sustainability at the ITOCHU Group

Society

Environment

GovernanceTargets
ITOCHU Corporation is working on the following targets that were set in line with our diversity policy.

Issues to Address
Provide an environment where diverse talent can thrive.

Commitment
Respect human rights and prohibit discrimination of any type, including age, gender, nationality and disability.
Provide an environment where employees can thrive even if their working hours are limited for reasons such as
child-rearing, nursing care or illness.

Specific Approaches
Continue fair hiring and promotion practices
Create a workplace culture supportive of mutual respect
Rational consideration toward the working environment for disabled persons
Adapt to the needs of LGBT employees and provide employee training on the subject
Improve company daycare and nursing care support services
Improve individualized support for employees' life stages and careers
Promote flexible work arrangements through telecommuting
Support to senior citizen employees above the age of 65 so they can thrive

Success Indicators
FYE 2021: Share of women among career-track employees above 10%
FYE 2021: Share of women in supervisory positions above 10%
FYE 2021: Share of disabled employees at 2.3%

Women in Career-Track & Managerial Positions (as of March 31 for each respective year)
Year

2018

2019

2020

% of Women Managers

6.8%

7.6%

8.1%

Women/All Managers

173/2,558

195/2,555

209/2,566% of Career-Track Women

9.0%

9.4%

9.7%

Career-Track Women/Total

313/3,461

327/3,463

335/3,462

FYE 2021 Goal

Over 10.0%

Over 10.0%100Sustainability at the ITOCHU Group

Society

Environment

GovernanceSupport for Diverse Talent
ITOCHU Corporation formulated a Plan for Promotion of Human Resource Diversification in December 2003 thatfurthered the diversification of our talent, entrenched that diversification and helped these employees succeed. We
will continue to build an appealing company and corporate culture by providing an environment where each andevery employee can exploit their unique traits to thrive and by working to strengthen our individual andorganizational capabilities.
ITOCHU Corporation HR Diversity Initiatives

Support for Female Employees
Our support for women gets the greatest amount of focus in our initiatives to diversify human resources. By
implementing the Plan for Promotion of Human Resource Diversification, ITOCHU Corporation has hired more
women to meet our target, while we also provide programs to support work-life balance beyond the level requiredby law. At present, while these programs serve as a safety net, we provide attentive individual support that is
tailored to each person's stage of life and career through Gen Ko Tsu Reform. Meanwhile, to create models of
successful women and provide them with rewarding work—with our focus being on developing future managerial
candidates—we conduct training that fosters career awareness among young career-track women and raiseawareness among organization managers through their training programs. (See below for our action plan
stipulating specific targets and initiatives moving forward.)
Action Plan Based on the "Act of Promotion of Women's Participation and Advancement in the Workplace" andthe "Act on Advancement of Measures to Support Raising Next-Generation Children"(https://www.itochu.co.jp/en/csr/pdf/action_plan.pdf)
Gen Ko Tsu Reform101

Sustainability at the ITOCHU Group

Society

Environment

Fostering Career Awareness Among Career-Track Women

Measures to Support Career-Track Women

102

GovernanceSustainability at the ITOCHU Group

Society

Environment

Governance

Share of Women in Career-Track/Managerial/Executive Positions★
(as of March 31 for each Respective Year)
Career-Track(Unit: people)
Managerial

Executives & Directors

Total

Women

Share

Total

Women

Share

Total

Women

Share

2020

3,462

335

9.7%

2,566

209

8.1%

45

4

8.9%

2019

3,463

327

9.4%

2,555

195

7.6%

44

2

4.5%

2018

3,461

313

9.0%

2,558

173

6.8%

45

2

4.4%

★Data assured by KPMG AZSA Sustainability Co., Ltd, an external assurance provider based on the international
standard ISAE 3000. (P216)

Clerical Career Support
ITOCHU Corporation has been running the Career Workshop for Clerical Staff for top-grade clerical employees since
FYE 2016. This is training aiming to improve skills to cultivate a mindset as a model of core personnel responsible
for administration work and to demonstrate leadership in the workplace through company-wide role assignment.
This training sees the participation of 10 to 20 employees from the target group all over the company every year.
These employees prepare action plans relating to organizational issues and experience mentoring and othermissions and roles over approximately one year.

Social Inclusion Support for Disabled Persons
To provide the handicapped possessing physical, mental or other disabilities with a workplace that is motivating
and rewarding, we established ITOCHU Uneedus Co., Ltd., our first special subsidiary, in Yokohama, Kanagawa
Prefecture in 1987. The disabled person employment rate in ITOCHU is 2.21% as of March 2020. We are promoting
an expansion in the range of work and recruitment of disabled persons in anticipation of an increase in thestatutory employment rate in the future.

Initiatives by ITOCHU Uneedus Co., Ltd.
ITOCHU Uneedus Co., Ltd. provides services including
dry cleaning, photo and document printing, mail delivery,laundry and cleaning. The company's motto is about
stringent quality control and friendly service. All drycleaning processes are performed by mixed teams of
disabled and non-disabled persons. To expand businessas well as to create a more welcoming workplace
Left: New Offices of ITOCHU Uneedus Co., Ltd.
environment for staff dealing with an array of disabilities,(Tsuzuki Ward, Yokohama)in November 2015 the company relocated to new offices
Right: Work in the Cleaning Department
in Yokohama's Tsuzuki Ward with 140% more floor space(http://www.uneedus.co.jp/ (Japanese only))
and the latest equipment. Since marking our 30th year inbusiness in 2017, we have continued striving to proactively support social inclusion for disabled persons and help
create a society where they can experience the joy of making a contribution through work.

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Sustainability at the ITOCHU Group

Society

Environment

Governance

Employment of Disabled Persons
Employment of Disabled Persons★
(as of March 1 for each Respective Year)
Percentage of Disabled Employees (%)
2020

2.21

2019

2.17

2018

2.04

* The figures of employment ratio of people with disabilities in 2018 and 2019 are the combined total of ITOCHU
Corporation and the certified special-purpose subsidiary, ITOCHU Uneedus Co., Ltd. The employment rate wascalculated with ITOCHU Human Resources & General Affairs Services Inc. also added to group applicability(special case of an affiliated company) for 2020.
★Data assured by KPMG AZSA Sustainability Co., Ltd, an external assurance provider based on the international
standard ISAE 3000. (P216)

Support for Middle-aged and Older Employees' Success
ITOCHU has long been proactively promoting activity support of middle-aged and older employees. We employ all
those who so desire under the Employment Extension System after they reach retirement age at 60 years old inlight of the point of view of the decreasing birthrate and aging population in Japan and activity support for diverse
personnel. This means we are developing an environment in which middle-aged and older employees can continue
to work utilizing the wealth of knowledge and experience they possess even after they have reached the retirementage. We also hold training such as life planning seminars for employees at the age of 58 years old and future
course selection briefings for employees at the age of 59 years old. Therefore, we are supporting work styles andmoney plans after the extension of the employment of employees. We will do yet more to create an environment
where middle-aged and older employees can continue performing motivating, rewarding work more than ever.

Initiatives Conducted Overseas
In South Africa, where the ITOCHU Group's Integrated Auto Service (IAS) is located, the "Broad-Based Black
Economic Empowerment" (B-BBEE) program has been introduced to improve the status of people who haveunjustly suffered discriminated and other disadvantages during the apartheid era. The "B-BBEE" program assesses
a company's contribution to resolving these issues based on a scorecard with evaluation criteria set by the South
African Government, which include elements such as ownership, management control, employment equality, skills
development, priority procurement, business development, and socio-economic development. The IAS has received
a Level 4 certification issued by Metanoia Ratings in 2019, with a score of 80.01 out of 100.

104

Sustainability at the ITOCHU Group

Society

Environment

GovernanceAccolades for ITOCHU Corporation
ITOCHU Corporation's initiatives in "Creating Environments that Bring Out the Best in Employees" have won muchpraise.
We won the Excellence Award (Family-Friendly Enterprises Category) at the Minister Prize in Equal
Employment/Work-Life Balance organized by the Ministry of Health, Labour and Welfare in FYE 2018.

2017 Award for Excellencefrom the Minister of Health,Labour and Welfare for
Platinum Kurumin Authorization

New Diversity Management"Excellent Equal

Selection 100

Opportunity/Work andFamily-Life Balance
Companies" ("Family-friendly
Companies" Category)

Companies making excellent
initiatives to provide employees withsupport at work as well as withchildcare receive approval to display
the Platinum Kurumin Authorization
mark. (Received in 2016 / Ministryof Health, Labour and Welfare)

A project for selecting excellent
companies that provide diverse
human resources with
opportunities and an environment
for exercising their potential.
(Selected in March 2016 /Ministry of Economy, Trade andIndustry)

A program recognizing
companies that promote
exemplary programs with anequal emphasis on work andchildcare/nursing care. (Selected
in November 2017 / Ministry of
Health, Labour and Welfare)* Related data: Employee Status (P93)
Share of Women in Career-Track/Managerial/Executive Positions (P103)
Number of Hires by Gender (P132)

105

Sustainability at the ITOCHU Group

Society

Environment

Governance

Employee Training
Action Plan
SDGs

Issues toTargets

Address

Co

Business
Area

Commitment

Performance Indicators

Specific Approach

Degree of Progress(Non-consolidated)

The positive answer rate to the "Education and Training"
Continue to develop andprovide training programs at
all jobs levels.
Continue and enhance

Sustainable
development
Human
HeadofResources
quarters
employees'
Affairs
capabilities

item in the engagement

trainees.
Offer diverse career path
options and experience indiverse works throughregular rotation.

survey: 60% or higher.
FYE 2021: Percentage ofcareer-track employees who
acquire business-level
English skills in their first

Foster career awarenessamong employees by

eight years at the company
at 100%.

enhancing personnel
assessment, career vision
training, career counsellingsystems and otherprograms/systems.

expenses exceeding one
billion yen.
Rate of positive responses tothe "education and training"overseas deployment ofinterns and language
We will develop training
programs on a global basisthat respond to the changing
times and business needs. We
will also utilize training
programs to continuously
produce excellent humanresources.

FYE 2021: Annual E&D

FYE 2021: Percentage ofcareer-track employees who
are deployed overseas intheir first eight years at thecompany at 80% or higher.

item from the FYE 2019 Engagement Survey was 71%.
*We did not conduct a survey in FYE 2020. The latest
data is for FYE 2019.
We have been continually reviewing and developing
training programs (e.g., the trial introduction of nextgeneration related training).
We are running a trial to provide video content as partof career vision training with an eye on a learning
environment that meets the diverse needs of ouremployees.

Below is the Outlook Current as of February 20
in FYE 2020:
Annual E&D expenses forecast ⇒ Over approximately
1.2 billion yen
Acquisition rate of business level English skills forcareer-track employees in up to their eighth year sincejoining the company ⇒ 100%
Overseas dispatch rate for career-track employees in up
to their eighth year since joining the company ⇒ 80%

Policy and Basic Concept
ITOCHU Corporation's employee training is focused on providing practical work experience through on-the-job(OJT) training. This is supplemented by initiatives to foster a desire to grow through appraisals, assessments andfeedback, as well as employees' acquisition of knowledge and skills through the training. We also provide growth
opportunities tailored to employees' individual situations and careers. After becoming industry professionals who
can thrive in any field, we train them into Global Management Talent who will lead our worldwide business in the
future.
Human resource development is based on thisphilosophy. We will accomplish infinite missions byinheriting the intentions contained in the spirit of"Sampo-yoshi" (In Japanese, "yoshi" means "good",
and "sampo" means three sides, and these three sides
consist of (1) the seller ("urite"), (2) the buyer("kaite") and (3) society ("seken"). "Sampo-yoshi" istherefore: good for the seller, good for the buyer andgood for society).

106

Sustainability at the ITOCHU Group

Society

Environment

GovernanceTargets
Based on our employee training policy, ITOCHU Corporation works to achieve the following goals.

Issues to Address
Sustained employee skill development

Commitment
We develop training programs on a global basis. We do this with a market-orientated way of thinking toward thedevelopment of marketing professionals who are able to continually transform business in line with needs while
inheriting our corporate mission. We then utilize these training programs to continually produce talented people.

Specific Approaches
Continuously develop and implement training programs at all levels
Continue and augment overseas practical training assignments and language immersion assignments
Provide various career paths and work experience through regular rotations
Foster career awareness in individual employee through personnel assessments, career vision training and anenhanced career counseling program

Success Indicators
FYE 2021: annual E&D spending over 1 billion yen
Positive response rate of 60% or higher to "education & training" items on the engagement survey
FYE 2021: 100% of career-track employees gain business level English skills after 8 years with the company
FYE 2021: At least 80% of career-track employees take overseas assignments by eighth year with the company

Structures and Systems
ITOCHU Corporation has been implementing a globally-mindedpersonnel strategy since FYE 2008 with the goal of maximizing thevalue of our worldwide work force and optimizing this group of
employees as a whole. Specifically, in FYE 2011 we establishedleadership standards, we created a database of organizational leaders
worldwide,* and we constructed the Talent Management Process tohire, develop, utilize and promote excellent talent who will expand
overseas revenues worldwide by coordinating with division companies
and overseas blocs.
We also reflect the philosophy and values we have inherited over the
160 years since the foundation of our company in our recruitment
standards and evaluation and training systems. With this, we arerecruiting and training people who match the values of ITOCHU on a
global basis.
* We created the ITOCHU Global Classification (IGC), global standards
based on positions and duties for positions at all levels worldwide, in
FYE 2010, which we use to place, promote and train personnel
regardless of nationality.

Talent Management Process* Relevant data: Overseas Bloc Employees by Region (P94)107

Sustainability at the ITOCHU Group

Society

Environment

GovernanceTraining System
The ITOCHU Corporation training system consists of company-wide training, along with line training for specificcompanies and administrative divisions that is tailored to the nature of their industry, specialties and so on. Thereis a wide range of training opportunities at various levels, not only for Headquarters employees, but also for thoseat certain overseas bloc companies and Group companies.
Overseas blocs arrange their own training systems to teach the skills and expertise required for their business andmarkets. In combination with the ITOCHU Corporation training system, they develop management talent capable ofglobal success.

108

Sustainability at the ITOCHU Group

Society

Environment

GovernanceTraining Results
Time/Cost Allotted for Employee Skills Development Training
FYE 2017
Total annual training time (hours)

200,195

FYE 2017

FYE 2018
217,734

FYE 2018

FYE 2019
160,510FYE 2019

FYE 2020
168,425

FYE 2020

Average training/development hours per
regular employee (hours)*

46.72

50.81

37.46

39.58

Average training/development cost per
regular employee (yen)359,000

334,000

302,000

269,000* Calculation method: total annual training hours / employees at end of fiscal year

Attendance in Major Training
Training

FYE 2017

FYE 2018

FYE 2019

FYE 2020

Administrative Intern System

115

121

96

110

Global Development Program

128

134

141

154

Organization Manager Workshop

417

403

405

337

Short-Term Business School Dispatch

51

39

31

37

Junior Chinese/Special Language Dispatch

52

61

39

10

Chinese Lessons

469

614

237

158

2,108

2,075

1,885

1,940

Career Vision Support Training (total)

Key Points for Better Training
First, in FYE 2014 we created a training scheme for talent capable ofshouldering administrative responsibilities at Group companies.
Specifically, in FYE 2015, we started a training program to learn aboutaccounting work efficiently in a short period of time through practice tostrengthen the acquisition of basic knowledge on business management
and risk management techniques. This is mandatory training for young
employees. Additionally, we have a replete lineup of Group company
employee trainings so that domestic Group company employees can
upgrade their skills and expand their networks within the Group.
Furthermore, we conduct trainings in the Global Development Program
Training in the Global Development
and the Short-Term Business School Dispatch to develop global
Programmanagement talents with an overseas perspective. Meanwhile, we wereamong the first to offer a short-term overseas dispatch system in 1999. This program is designed to improve theEnglish language skills of young employees at the headquarters and foster a global mindset. Chinese and otherspecial language programs dispatch employees to emerging markets such as China and etc.. These are the coreprograms for our initiatives to foster specialists in each market.
For our training with an emphasis on practical on-the-job skills, we conduct Career Vision Support Training todevelop industry professionals with diverse values, along with independent training programs that are based oneach company or Headquarters administrative division's talent strategy and tailored for various objectives.
Most recently, we have also been promoting the development of people capable of driving business into the next
generation. We do this by providing our employees with opportunities for training and lectures aimed at studying
cutting edge business model cases and acquiring IT expertise according to our Mid-term Management Plan.
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Sustainability at the ITOCHU Group

Society

Environment

Governance

Talent Synergy with CP & CITIC
In January 2015, ITOCHU Corporation formed a strategic business andcapital tie-up with Charoen Pokphand Group Company Limited (CPG)and CITIC Limited (CITIC), which are some of the leading
conglomerates in Asia and China, respectively. Thereafter, in January
2016, the three-company group signed a memorandum to strengthen
talent synergies as the foundation for producing medium- to long-termbusiness synergies and raising enterprise value. According to thememorandum, the goal for the future is to build a robust network oftalent between the three companies and construct a foundation that will
support their strategic partnership. This will be accomplished bydispatching and exchanging talent between the three companies fromthe short-term to the long-term, dispatching trainees to join training
programs at other companies, and conducting new joint training.

The 4th Three Companies' Combined
Training Program (Tokyo) (July 2019)

In FYE 2016, the three companies held their first joint training in Tokyo. We held this combined training seminar forthe second time in Beijing, where CITIC is based, in FYE 2018 and for the third time in Thailand (Khao Yai and
Bangkok), where CPG is based, in FYE 2019. In FYE2020, we held this training for the fourth time in Tokyo. We
select employees who match the business themes established in advance from the three companies. The
participants come to fully understand each other's management policies, values, history and main business. They
then thoroughly discuss the creation of business synergy. With this, the aim is to build a solid personnel network as
partners.
The three firms are also steadily accepting trainees into their existing programs through short- to -long-term talentdispatch and exchange arrangements.
In addition, the strategic business and capital tie-up was accompanied by the FYE 2016 startup of a project todevelop 1,000 Chinese-speaking employees, who account for one-third of all career-track employees. The project
has made progress in laying a solid linguistic foundation. By the end of FYE 2018, we reached our goal of 1,000
people. We continue developing those employees even after that. The total number of trainees as of the end of FYE2020 was 1,231. We will continue to build the foundations to further promote the expansion of business in China
and the rest of Asia in the future.

ITOCHU Morning Activity Seminar
In September 2016, we began conducting early-morning training
sessions and presentations as one measure to encourage shifts
beginning in the early morning. The themes of these seminars arefocused on the next generation of business and health. We held theseseminars a total of 7 times with the participation of 3,162 people in FYE
2020. We received comments from the participants like the following: "I
was able to hear stimulating stories before work, so I felt very positive."
We plan to hold these seminars on a periodic basis in the future.

An ITOCHU Morning Activity Seminar

Morning Activity Seminar Results
Major Seminars
Date

May 2019

Title

Speaker

Future of Artificial Intelligence: Beyond
Deep Learning

PhD, Yutaka Matsuo, Professor of Graduate
School of Engineering at the University ofTokyo

Ideal Leaders for the Future: Styles andAugust 2019

Readiness Necessary for Leaders to Create
Leaders
110

Ryuji Nakatake, CEO at Teambox Inc.

Sustainability at the ITOCHU Group

Society

Environment

Governance

HR Appraisal & Assessment System
The HR Appraisal & Assessment System is a core part of the human resources organization that helps employees
fully demonstrate their capabilities in a motivated and rewarding manner. It covers all ITOCHU Corporation
employees. One part of the system is Management By Objectives (MBO), by which we assign individual employeeswith targets that match up with the management plan, then confirm execution. This approach helps us carry out
business strategies. We have also created the Competency Assessment. This provides a comprehensive view of anindividual employee's competencies, expertise, past career, aspirations and suitability, which we then use to plan
assignments and transfers.
In order for these components of the HR Appraisal & Assessment System to function, we believe it criticallyimportant that superiors conduct fair and impartial evaluations and meet with their subordinates to provide
feedback. 360° feedback* and assessor training enlighten superiors so that they will encourage employees todevelop and grow.
* Multifaceted observation: A system by which feedback from observations by the organization managers
themselves and subordinates are used to review everyday personnel management that the organization
manager typically does not notice, followed, if necessary, by initiatives to make improvements or upgrade
capabilities. We make sure to apply this approach every year.
Overall Picture of the Personnel Evaluation Systems

Management By Objectives (MBO) Flow

Competency Assessment Flow111

Sustainability at the ITOCHU Group

Society

Environment

Governance

Career Support
Career Counseling
The Career Counseling Center provides wide-ranging counseling and support services for the diverse careers of all
employees, from new hires all the way up to organization managers. All the center's counselors are nationallycertified career consultants. They discuss a broad array of topics with visitors to address their individual
circumstances, including relationships with superiors, subordinates and other colleagues, how to go about one's
work, one's future and so on. In addition, as a part of our employee training, we arrange for all young employees
to undergo career counseling when they reach certain milestones in their ITOCHU careers. The center meanwhileserves experienced hires and middle-aged and older employees seeking to work beyond retirement age. There areover 500 consultation visits to the center each year. Here, visitors are provided complete confidentiality so they canfeel at ease conversing with a counselor. The center's aim is for employees to develop an awareness about how toshape their career.

Formal Introduction of the Challenge Career System
We have introduced the Challenge Career System as a measure to increase the mobility of personnel for careertrack employees working in Japan (excluding organization mangers). With the system, employees can check a listof job openings announced on the company intranet, then inform their superior of their desire for a transfer. With
the superior's approval, the system will try to match the employee with the desired division and, if successful, may
make a transfer between Division Companies or Headquarters administrative divisions. The aim of this system is tostrengthen organizational capabilities by motivating employees and fostering their career awareness with theprovision of career selection opportunities. Five people transferred in FYE 2020 following on from six people in FYE
2019.
Challenge Career System Process

Promotion of Rotation
We have formulated rotation guidelines for young career-track employees. The aim of this is to stimulate thepersonnel in the next generation who will support management in the future. We have determined the training andtransfer policy for each organization under the premise that participants will have finished their basic education by
their second year in the company and that they will have experience of at least three positions, including positions
overseas, by their eighth year in the company as a general rule. In addition, organization managers explain thistraining policy to young career-track employees and then hold career meetings to exchange opinions with them.
With this, we have developed an environment in which it is possible for young employees to tackle the work infront of them with a view to the future. We have also created a mechanism for other organization members andemployees in clerical positions so that they can achieve diverse careers by reviewing their transfer requests androtation results every year.

ITOCHU Internship
ITOCHU provides an internship to students which allows them to tackle various challenging issues based on pastbusiness cases. We do this so that they can think about their careers in terms of working in a general trading
company.
ITOCHU Website for students (Japanese only) (https://career.itochu.co.jp/student/information/seminar.html)

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Sustainability at the ITOCHU Group

Society

Environment

GovernanceOccupational Safety and Health Management
Action Plan
SDGs

Issues toTargets

Address

Co

Business
Area

ImprovingHuman
the health HeadResourcesofquarters
Affairs
employees

Materiality

SDGs
Targets

Issues toAddress

Commitment

Specific Approach

We will improve thehealth of employees tocreate an environmentthat will enable
individual employees tobetter demonstrate
their capabilities. We
will build a system thathelps employees withcancer or long-term
illness to create abalance between
treatment and work,
thereby fostering aculture of mutual
support.

Business
Area

Performance Indicators(Non-consolidated)

Keep the percentage of employees who

Percentage of employees

receive regular medical checkups at 100%.

who receive regular medical
checkups: 100%.

Establish well-equipped in-house clinics anda system for supporting each employee inreceiving personalized medical care.

FYE 2021: Improve healthindicators (such as BMI)

Promote measures for helping employees

compared to FYE 2017

create a balance between cancer treatment
and work.

values.

Offer healthy dishes in the employee
cafeteria.

employees who leave work
due to cancer or long-term

Promote the program for supporting
smoking cessation treatment expenses.

illness at 0%.

Utilize health management web tools for
employees and continue to provide special

employees found to have a

FYE 2021: Rate ofprograms for employees at a high risk forlifestyle-related diseases

lower.

Specific Approach

Performance
Indicators

Regular medical checkup rate: 100% in FYE 2020.
Rate of improvement in the health index (e.g.,
BMI) compared to FYE 2011: -2% in FYE 2019.
Support for working while receiving cancer care:
Job turnover due to cancer and long-term
illnesses continues to be 0%.

FYE 2021: Percentage ofhigh level of stress in the
stress check at 5% orCommitment

Degree of Progress

Rate of those found to have a high level of stressin the stress check: 2.9% in FYE 2020.
Health management web tools for employees
utilization: We are continuing to run a program forthose at a high risk for lifestyle-related diseases
among young employees and we expanded thescope to include those who are subject to specifichealth guidance (a total of 115 participants in FYE2020). We held a company-wide walking event.

Degree of Progress

Metals & Minerals Company
We held internal EHS (Environment, Health and Safety)

Ensurestableprocurement
and supply

Sustainable minedevelopment thatreflects
consideration of
the risks in
occupationalsafety and healthandenvironmental
risks, and that
contributes tolocal communities

We will promotesustainable developmentof natural resources by

Miningbusinessfully committing to EHS(environment, health,occupational safety) andharmonious coexistencewith local communities inareas which we operate.
We will improve local
infrastructure such as
medical care andeducation.

training courses for supervisors and company employees

Ensure the thoroughapplication of the EHS
guidelines.
Contribute to local
communities throughactivities for improving
medical care,education andinfrastructure.

Implementation ofannual internalseminars to ensure our
employees are fully

belonging to sections engaged in resource development.
The attendance rate of those subject to this training was100%.
We checked the proper compliance to the EHS guideline
by one new project and eight existing projects in ouraware of the EHS
guidelines.

mining business, and also by one another resourcerelated project.

Donations to medicalcare, education andWe carried out activities that contribute to the local
community as part of each project we invest in.

build infrastructure in
local communities.

As a special initiative, our Australian subsidiary, ITOCHU
Minerals & Energy of Australia Pty. Ltd., together withother local group companies, contributed A$200,000 in
total to the Australian Red Cross Society as support torecover from the damage caused by the Bushfires.

Policy and Basic Concept
Occupational Safety and Health Management for Our Employees
ITOCHU Corporation considers people to be its greatest asset. Ensuring that every employee can reach their fullpotential leads to increased corporate value. Based on this way of thought, we promote various policies aimed atrealizing an environment in which all employees can leverage their unique talents and have the peace of mind to
focus on their work.
The cornerstone for achieving our Guideline of Conduct, "I am One with Infinite Missions," is reinforcing employee
health while developing employee ability. Based on this idea, we have codified our company policy towards healthmanagement in the ITOCHU Health Charter (enacted June 2016). We hope this will help every employee reach
their maximum potential. ITOCHU Corporation recognizes the diversity of its employees with regard to gender, age,nationality, race, religion and existence of handicaps. We have defined our health charter as follows in order toachieve our vision as One with Infinite Missions, and perpetually improve corporate value.

1. Taking Responsibility for Employee Health
ITOCHU will take responsibility for the good health of each employee by actively supporting initiatives they take tomaintain or improve their health.

2. Contributing to Society by Maintaining Good Health
ITOCHU will develop soundly over the long term based on an understanding that the good health of its employees
is the foundation of the happiness of the employees themselves as well as their families, customers and wider
society.

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Society

Environment

Governance

3. A Legacy for Future Generations
ITOCHU will carry out its infinite variety of missions as a company in which healthy employees who are fulfilled
both spiritually and physically unleash their individual strengths.
Going forward we will pioneer various initiatives that lead the way toward work-style reform and healthmanagement. And we will build an environment that allows employees to find meaning in their work.

Occupational Safety and Health Management along the Supply Chain
Beyond our employees, ITOCHU Corporation also implements comprehensive measures to ensure the occupationalsafety and health of the stakeholders within our supply chain, including the companies we invest in andcontractors. In 2013, we established ITOCHU Corporation's Sustainability Action Guidelines for Supply Chains tocommunicate our expectations for partners along the supply chain. The Guidelines covers key safety and healthrelated issues such as "Management of working hours", "Management of health and safety", and "Management of
employee health".
We believe it is important to gain the understanding and cooperation of all of our suppliers and contractors
regarding our procurement-related policies. In keeping with this belief, in FYE 2014 we followed up on the
Guidelines with approximately 4,000 suppliers with whom we have continuing relationships, in order to raiseawareness and understanding of our expectations. In January 2015, we have made it a mandatory procedure to
inform all new suppliers and contractors of the Guidelines. We anticipate that these activities will lead to an
enhanced understanding among our business partners regarding our approach to sustainability.

Safety and Health Related Risk Assessments for Investment Projects
ITOCHU Corporation considers ESG (Environmental, Social, and Governance related) aspects to be crucial inassessing potential risks for investment projects. In addition to financial risks and opportunities, our due diligenceand risk assessment process for prospective investments therefore includes the use of a comprehensive ESG
Checklist, which covers seven core subjects aligned with the ISO26000, as well as 33 sub-issues. One of the core
subjects concerns Labor Practices, which includes sub-topics covering safety and health-related issues, such aslabor standards, occupational safety and health, and stakeholder engagement to enhance health and safety
practices. Our assessment of safety and health related risks for investment projects does not simply end at theinitial investment. We conduct continuous management assessments and ensure that we monitor companies in our
portfolio, ultimately to contribute to as much enhancement of business practices among investees as possible.
For more information, please see ESG Risk Assessment for New Business Investment Projects (P152).

Combatting Global Health Issues
ITOCHU Corporation has operations worldwide, with about 800 employees stationed overseas. As such, global
health issues including HIV/AIDS, tuberculosis, and malaria, which are widely recognized as three of the deadliest
infectious diseases today, are a major concern to our business, and we have implemented various initiatives in
response.
With regards to our employees and their families, we conduct detailed preparatory seminars regarding safety andmedical practices prior to overseas dispatch, including information on said global health issues. We also provide
employees stationed abroad and their families with mandatory vaccinations aligned to the recommendations
published by local governments. Vaccinations are administered by our Health Administration Center or a nearby
travel clinic. Once dispatched, our employees and their families have access to specialized health care service
companies that we partner with, which can provide information on local hospitals, details on how to avoid infection,and emergency treatment of illnesses.
In terms of community involvement, we have strived to enhance partnerships that can maximize our contribution
to combatting global health issues. Since 2017, we are supporting Friends of the Global Fund, Japan (FGFJ)(http://fgfj.jcie.or.jp/en/) through our membership in the Japan Center for International Exchange (JCIE), which is
responsible for the operation of FGFJ. We also work with Dole Philippines, one of our subsidiaries, to combat global
health issues including HIV/AIDS, tuberculosis, and malaria, in the local communities. We will continue to expand
initiatives in this area to fulfill our social responsibility as a global company.

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Society

Environment

GovernanceTargets
Based on our policies regarding the management of occupational safety and health, ITOCHU Corporation aims toachieve zero workplace accidents and death incidents for FYE 2021 as well, and will work toward the following
underlying targets.

Issues to Address
Strengthening employee healthCommitment
We will promote the health of each employee and establish an environment in which they can more fully display
their individual abilities. We will foment a climate of mutual support by establishing a support system that helps
employees with cancer and long-term illnesses balance work and treatment.

Specific Approaches
Continue 100% participation in medical checkups
Maintain complete in-house infirmaries and a support structure for dedicated medical care for each employee
Promote support measures for those living with cancer
Offer a healthy menu in the employee cafeteria
Promote programs to help people stop smoking
Utilize health management web tools for employees and continue to provide special programs for employees at
a high risk for lifestyle-related diseases

Success Indicators
100% participation in medical checkups.
FYE 2021: improve health indices (such as BMI) compared to FYE 2017.
FYE 2021: 0% job separation rate due to cancer or long-term illness.
FYE 2021: use stress checks to keep rate of high stress individuals below 5%.

Structures and Systems
ITOCHU Corporation considers employees to be assets. One of the company's vital responsibilities is to ensure
health and safety in the workplace so that employees can reach their full potential. We have built a robust system
led by the President & Chief Operating Officer, not just for incidents, accidents, disasters and other emergencies,
but also health management. This ensures that both ITOCHU Corporation employees working around the world andtheir families stay healthy and safe.
To implement our corporate mission of being "Sampo-yoshi," ITOCHU Corporation also discusses occupational
health and safety with the ITOCHU Labor Union, which counts approximately 80% of employees as members. (see"Labor Union (P95-98)"). Recurrent, active discussion between labor and management makes both cognizant of thechallenges facing the company and keeps them on the same page. This builds a healthy relationship that enables
them to consider and implement measures for improvement.
See P120 for the number employees who have undergone training on health and safety standards.

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Overview of Itochu Corporation's Occupational Health and Safety Management Organization

We have a standard management and escalation procedure for all matters regarding occupational safety andhealth, both domestic and abroad. For each of our Companies, Headquarters, and Overseas Blocs, we haveappointed an Occupational Health and Safety Officer, who is responsible for overseeing the execution of relevant
initiatives. These Officers also serve as contact points to which workplace incidents and death incidents arereported to within their related divisions. Managers are also expected to relay and escalate these reports to thehead office's Human Resources and General Affairs Division.
The Health Committee, chaired by the head of the Health Administrative Center and Human Resources and General
Affairs Division, meets once a month to review and deliberate on important matters related to health. In case of
emergencies that require immediate attention, relevant personnel are gathered to share insights on the issue at
hand and escalate matters accordingly to the Health Committee. Emergencies can include health issues such as
infection outbreaks, concerns raised by occupational physicians and risks associated with excessive working hours
and working environments.
With regards to Health Management related initiatives and concerns, we hold a monthly Health Management
Council to share progress and any concerns or risks regarding occupational health and safety.
Any critical issues identified in the Health Committee or the Health Management Council are escalated via the
Human Resources and General Affairs Division to the Chief Administrative Officer (CAO), who holds the highest
level of responsibility regarding health and safety. The CAO is responsible for reporting highly important issues tothe Board of Directors and the Chairman & CEO. Matters that are not urgent are reported to the Board of Directors
once a year, through the same reporting process.
In addition, we submit reports relating on health management and labor health and safety to the Board of
Directors every year.

OHSAS18001 Certification Rate of ITOCHU Facilities
OHSAS18001 (Occupational Health and Safety Assessment Series) is a framework that certifies facilities withmanagement systems that fulfill strict requirements for health and safety that address risks appropriately andenable continuous performance enhancement. The certification requires comprehensive elements such as a healthand safety management policy, targets and action plans, the evaluation of initiatives implemented, and a process
to reflect evaluation results for further improvement of the entire process. As of March 2019, among the 502
subsidiaries under ITOCHU Corporation, one company (0.2%) has acquired the OHSAS18001 certification.

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Society

Environment

GovernanceOperation of the EHS Guidelines
The Metals & Minerals Company has established and is operating Environment, Health and Occupational Safety(EHS) Guidelines for its metal and mineral, coal and uranium mining businesses. EHS guidelines supports us towork on sustainable mining development leading to the stable supply of resources.
It is our obligation to avoid and reduce the EHS risks such as environmental pollution, health hazards of workers
and operational accidents caused by our business activities (e.g., exploration, development and production). To
that end, we have prepared EHS guidelines as technical reference documents summarizing the EHS issues andrecommendations for risk management. For throughout implementation of the guidelines, we also utilize checklists
available in Japanese and English.
EHS Guidelines apply to new investments, as well as projects in which we are already participating. We
communicate intensively with our partners for consultation and improvement on resource development withgreater consideration for the environment and safety. In FYE 2019, we performed checks on one new project andfive existing projects in non-OECD countries. We then set items requiring follow-up.
We have prepared guidelines in line with global standards such as the International Finance Corporation (IFC) andstandardized processes with checklists. Meanwhile, we continuously review the processes so that we can operate
the guidelines flexibly to suit the individual risks of each project.
First of all, it is important that organization members have an awareness of EHS compliance. Accordingly, we aimto thoroughly spread information by conducting awareness activities using concrete examples every year. We heldinternal training courses for supervisors and company employees belonging to sections engaged in resource
development in FYE 2019. The attendance rate of those subject to this training was 100%.

Health Administration Center
The Health Administration Center serves as the clinic for our headquarters in Tokyo and employs a total of 20
medical specialists, as well as x-ray technicians and pharmacists. For more than 30 years public health nurses haveacted as "border-less medical concierges" who provide individual health guidance customized to the situation of
every employee, both in Japan and overseas. This is based on close cooperation with medical specialists for various
lifestyle-related diseases. In this way, the center supports ITOCHU Corporation health management throughindividual health management for each employee. Specifically, in addition to the specialized disease management
mentioned above, the office provides general practice medicine (internal medicine, orthopedic surgery, dentistry),
checkups (regular medical checkups, half-day complete checkups, and medical checkups for employees travelingoverseas or returning from abroad on a temporary or permanent basis), various vaccinations, and examinations. It
also offers medical counseling and provides information. In FYE 2020, almost 100% of our workers in Japan
received regular medical checkups.

Mental Health
Concerning mental health, we have set up a stress management room in the company and offer counseling by aclinical psychologist. Employees can also seek counseling from a company physician or see a psychiatrist in-house.
Our Health Insurance Union has set up a health consultation website called "Health & Mind Online" that enables
employees to seek consultations by phone or over the net. On December 1, 2015, the Industrial Safety and Health
Act was revised to require businesses to conduct employee stress checks once per year. ITOCHU Corporation's
Health Administration Center took the lead in trialing stress checks a year early in October 2015. These were thenintroduced on a full-scale basis in FYE 2017.

Safety Measures for Employees on Travel or Stationed Overseas
ITOCHU Corporation operates worldwide with roughly 800 employees stationed overseas. The company also sends
as many as ten thousand people on overseas business travel and works to offer health management to overseas
staff. Since close communication between overseas locations and Japan is vital to overseas security management,
we have stationed overseas safety specialists at our headquarters. They regularly exchange information about
politics, economics, public safety and other factors with personnel and general affairs representatives assigned toeach of the eight blocs worldwide. Staff meet through public security seminars, etc. They then disseminate
appropriate measures throughout the company. We have also established a system to cover regions where
information is more difficult to obtain through contracts with international security consultant firms.
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Measures to Address Medical Issues and Prevent Infectious Diseases
Prior to being dispatched, all employees stationed abroad are required to undergo mandatory vaccination in linewith governmental recommendations for each international region/country. ITOCHU's Health Administration Center
provides employees with vaccination services – in case specific vaccinations are not available, we direct ouremployees to nearby clinics that specialize in vaccinations. All vaccination costs are also covered by the company.
Moreover, we provide both the employees and their families with thorough preparatory seminars on health andsafety matters regarding the countries they are assigned to. Global health issues such as HIV/AIDS, tuberculosis,
and malaria are especially crucial for certain countries. Therefore, we ensure that the preparatory seminars coverthese issues, and also provide follow-up seminars following their return to Japan.
Once our employees and their families arrive in their assigned countries, we provide medical support in various
ways, such as partnering with a specialized health care service company (International SOS (https://www.
internationalsos.com/)), to provide information on any potential issues that may occur, information on how toaddress and manage health emergencies, and support during emergencies, such as those that require emergency
transportation.

Basic Health Management Support
Concierge without Borders: This is a service that we provide to employees and their families to support themin addressing chronic conditions. Employees and their families can reach out via e-mail or phone call tooccupational health nurses supported by specialized physicians, and receive advice on health-related issues asnecessary.
Introduction of Local Medical Facilities: We are able to introduce reliable local medical facilities in the
countries we operate in, where employees can receive necessary medical services.
Routine Health Checkups: In addition to pre-dispatch comprehensive medical examinations, we provide
employees and their families with annual health checkups. These checkups can either be conducted upon shortterm return to Japan, or in the countries where they are stationed in – including surrounding countries.
SECOM Furusato Care Service: We provide support for our employees' elderly family members living inJapan. Our support covers a medical care system run by SECOM, which can be accessed year-round, at any
time of day. The service allows for elderly family members to receive phone-based health support from a
specialized nurse center.

Health-Related Emergency Support
International SOS: This is a service that we provide employees and their families to support them inaddressing acute medical conditions. The service provides access to a multi-language call-center where users
can inquire about any local issues regarding safety, including terrorism, social disturbances, and medical
concerns. Additionally, if our employees or their family members encounter any emergency such as injuries oracute medical conditions, they can access International SOS to request relevant support, which includes
arrangements for appropriate transportation, accompanying doctors and nurses, as well as access to medical
institutions that are equipped to address the emergency.
JOMF Kids' Net: This is a service that we provide employees and their families to address child-related medical
issues abroad. The service can be accessed via international phone call to receive advice from pediatricians inJapan.

Addressing Health and Disease Related Issues in Local Communities
ITOCHU Corporation engages in community investment in the Philippines to address global health concerns. This isconducted mainly through the Mahintana Foundation Inc. (MFI), an NGO that was developed by the Dolefil* SR
Division of Dole Philippines, one of ITOCHU's subsidiaries. Along with MFI and local municipalities, ITOCHU has
engaged in comprehensive development initiatives for over 40 years, including the creation of industries and labormarkets, environmental conservation and reforestation, education, provision for basic needs, enhancement of
employee benefits, and health and safety. Specifically regarding health and safety, global health concerns such as
HIV/AIDS, tuberculosis, and malaria are particularly crucial, and we have implemented the initiatives listed below
to prevent outbreaks of infectious diseases among employees and the local community:* Dole Philippines's Pineapple Division

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Society

Environment

Social Issues

GovernanceInitiatives

Infectious diseases

Vaccinations, education and training for dengue fever prevention, disseminatinginsecticide-treated nets (ITNs), extermination of insects, and promotion of vitamin A
consumption

Healthcare

Promotion of vitamin A consumption, provision for pregnancy support, dental services,and education and training on adolescent health issues

Regarding malaria, the positive impacts of these prevention initiatives are continuing to spread, with an increasing
number of surrounding regions reporting to be free of malaria infections.

Occupational Health and Safety Data
Safety initiatives in Japan incorporate countermeasures against large-scale disasters like earthquakes. These
include creating a business continuity plan, preparing disaster supplies such as drinking water, food, and toilets,
conducting emergency drills, and training employees to use our safety confirmation service. We encourage
employees to prepare for large-scale disasters by making sure they have a way to contact their families in theevent of an emergency, keeping a pair of comfortable walking shoes at work, and being sure they know their way
home on foot.

Occupational Health and Safety Data (Individual Employees*1) ★
FYE 2017
Full-timeFYE 2018

Part-time

Full-time(Unit: people)

FYE 2019

Part-time

Full-timeFYE 2020

Part-time

Full-timePart-time

Employees Employees Employees Employees Employees Employees Employees Employees
Number who
suffered fromoccupational
accidents(number

5（4）

1（1）

7（5）

1（1）

4（2）

0（0）

9（8）

0（0）

0

0

0

0

0

0

0

0

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0

0

0

0

0

0

0

0

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

which
occurred
during*2commute)Number of
Fatalities
OIFR(Occupational
Illness
Frequency*3
Rate)
Number who
suffered Lost
Time
Incidents*4(LTI)
LTIFR (Lost
Time Injury
Frequency
*5
Rate)

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Environment

Governance*1 Employees targeted: Full-time employees — career-track employees, clerical employees, those in special
positionsPart-time employee — contract employees*2 Number who suffered from occupational accidents: The total number of those who suffered from of
occupational accidents or non-LTI due to their work and those injured during their commute.
*3 OIFR: The rate of incidence of lost-time accidents corresponding to disease per million hours (calculated as thenumber of people suffering from LTI due to illness divided by the total number of working hours times 1
million)*4 Lost time incidents (LTI) are situations in which a work-related injury or illness causes the victim to be absent
from work on the following day. (occupational accidents)*5 LTIFR: The rate of occurrence of incidents that caused employees to miss work per million working hours(calculated as the number of sufferers of LTI divided by the total number of working hours times 1 million)

Performance Benchmarking Against Industry Average (Wholesalers and Retailers with
Over 100 Employees)
2016
1.74

Lost-time incident rate

2017
1.94

2018

2019

2.08

2.09

* The data above references the Ministry of Health, Labor and Welfare's 2019 Research on Work-related Accident
TrendsTotal Number of Participants in Training Related to Health and Safety Standards(Individual Employees)★

General training covering health and safety standards*1
Human resources-led training covering health and safety
standards*2

FYE 2017

FYE 2018

FYE 2019

FYE 2020

2,744

3,410

3,543

3,629

48

61

48

453

*1 Training new recruits (career-track employees and clerical employees), managerial workshops, training for
newly appointed section managers, pre-dispatch English and special foreign language training for young
employees, evacuation drills at the Tokyo headquarters, and hands-on training for overseas safety measures.
*2 Career vision training (including mindfulness classes and mental health management), morning activity
seminar.

FYE 2020 Number of Employees that Received Our Main Health and Safety-related
Training(unit: number of employees)
Number ofType of Training

Training Details

Employee
Attendees

Training new
recruits

Employees newly joining ITOCHU are informed on the importance of
health for their personal life and their career. The training includes
information on mental health and lifestyle-related diseases.
Employees are also educated on the company's health and safety
management by our occupational physician and our clinicalpsychologist.

120

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Number ofType of Training

Training Details

Employee
AttendeesManagerial
workshop on
building a healthy
workplace

New manager
training on healthmanagement

Training in
preparation foroverseas
assignments or
junior overseas
training

Hands-on training
for overseas safetymeasuresThis workshop is for all employees in management positions to
educate and train them on building a healthy work environment.
Training topics include how to manage the mental wellbeing of
employees, and how to prevent and address cases of harassment.

337

For newly promoted junior managers, industrial physicians andclinical psychologists provide training on how to guide and manage
the health and safety of subordinates through case-studies. The
training also provides guidance on how to maintain one's own
health once promoted to their new positions.

62

The training is mainly conducted by our occupational physician, andcovers health issues that are likely to occur in relevant countries, aswell as crucial differences in medical environments and lifestyles
between Japan and assigned countries. The training also covers
necessary preparations that are recommended prior to dispatch,and information on how to receive health checkups during theirassignment. We also provide the same training for the family
members of our employees, and provide information on key contact
points and resources in case of emergencies.

273

We give hands-on training to learn lessons in preparation for whenan emergency arises: what you will feel, think and do if you
encounter terrorism, an explosion, shooting or kidnapping in
addition to what happens.

32★Data assured by KPMG AZSA Sustainability Co., Ltd, an external assurance provider based on the international
standard ISAE 3000. (P216)

Health Management
In FYE 2017 we began to work on health management in earnest. This entailed promoting a range of measures toimprove employee health, based on the ITOCHU Health Charter (established in June 2016). These include theintroduction of "Health MyPage," which allows all employees to manage their health status, individual programs for
employees with a high risk of lifestyle-related disease (distributing wearable devices and offering expert advice on
health and diet), and better support for those trying to quit smoking (reimbursing medical costs involved inquitting). And in April 2018, we opened a new health-focused integrated dormitory for unmarried employees.
In an initiative to increase the health awareness of each employee, we introduced the "Health MyPage" app in April
2017. This app lets employees view medical checkup results via a PC or smartphone, and permits centralized
management of lifestyle data, such as number of steps walked that day, weight, percent body fat and calorie
intake. We also launched a personal guidance program for young employees with a high potential risk of lifestylerelated diseases. Participants receive wearable devices which collect data on exercise and sleep, and manage dataon diet as well. This enables them to receive daily diet and exercise instructions online from a health coach andnational registered dietitian. So far, more than 450 people have taken advantage of the opportunity and madeprogress under the program.
Our Health Insurance Union operates two recreation centers in Japan, and implements initiatives which include
cooperating with the Health Administration Center to fully cover the cost of treatment that helps employees stopsmoking.
Moreover, in August 2017 we began to lead the way in Japan with company initiatives to support balancing cancer
care and work from the three perspectives of prevention, treatment, and coexistence. We are striving to create aworkplace in which all employees, regardless of whether they suffer from cancer or long-term illness, can continue
to work without concern toward their fullest potential, all the while maintaining motivation and finding meaning intheir work.

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Policies for Living with Cancer
In August 2017, we began to implement measures to support balancing cancer treatment and work in accordancewith the ideas behind the ITOCHU Health Charter enacted in June 2016.
It is said that, today, one in two Japanese will develop cancer at some time in their life. Every year, 850,000
individuals are diagnosed with cancer, with working-age adults accounting for 30%. Cancer typically requires acertain period of intensive treatment, followed by careful, long-term follow-up care. At ITOCHU, some employees
continue to work while fighting cancer, and some have succumbed to the struggle. We believe that providing awork environment where employees may continue to work without fear, and without giving in to cancer, leads topositive work on the part of the employees and energizes the organization. So we have decided to keep thefollowing three perspectives in mind as we implement this measure.
Establish an environment in which employees can seek counsel and share information without concern
Strengthen the system that the entire organization uses to support prevention, early detection, and treatmentof cancer
Establish internal systems and programs which permit employees to continue to work and play active roles
while they receive treatment
We are newly promoting the following policies as support to balance cancer care and work from the threeperspectives of prevention, treatment and coexistence. This is in addition to developing a support structure forlong-term illnesses that includes the health management structure we have enhanced up to now, high-cost medical
expense subsidies, and a flexible work and holiday system.
Cooperate with National Cancer Center
Prevention: To improve the rate of early detection, we have added special cancer examinations under thesupervision of cancer specialists to our regular medical checkup.
Treatment: If an exam comes back positive, we refer the employee to the National Cancer Center for detailed
examination. If cancer is detected, we immediately coordinate with specialists from the National Cancer
Center to arranged state-of-the-art treatment.
Establish a system that offers support for balancing work with cancer treatment (See the figure below.)
Assign a coordinator who supports balancing work with cancer treatment, and foster a system and climate inwhich other employees, including the head of the organization, can help the employee with cancer to balancetreatment and work. After receiving the initial report, formulate a plan to support balancing treatment andwork which follows a prescribed flow that is dictated by the individual patient's condition.
Create a handbook explaining how to support balancing treatment and work, and establish a leave systemthat allows such support to be provided.
We assess the content of work-life balance support plans as individual performance goals (management by
objectives) under the purpose of assisting the implementation of these plans.
Enhance financial support for advanced cancer treatment
The company purchases a blanket policy to provide financial support to employees who receive advanced
medical treatment not covered by insurance.
Expanded scholarships and job search support for the bereaved family
Increase the amount of scholarship money paid to bereaved children through graduate school by roughly two
to three times what it had been previously.
If a bereaved child or spouse desires to work for the ITOCHU Group, every initiative will be made to find aplace for them within the Group.
By promoting these measures, we hope to create a workplace in which all employees, regardless of whether they
suffer from disease, can continue to work as much as they like without concern, and reach their fullest potential.
We aim to build a working environment where employees are able to maintain their motivation while finding a
sense of worth in their work.

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ITOCHU Corporation Support System for Balancing Work and Cancer Treatment* Career consultation desk provided by qualified counselor

Application to Group Companies
Due to our consolidated management, our initiatives with regards to occupational health and safety, and safety
management, cover not only our employees (including contract employees) but also those of our group companies.
Specifically, Group companies also conduct things like stress checks, safety initiatives in Japan, information on
safety measures overseas, collaboration with overseas security and medical service companies, and seminars prior
to overseas assignments. Group companies are increasingly adopting a morning-focused work style, and the groupoverall is striving to reduce the total number of working hours and promote employee health. In addition, we areworking to strengthen the labor management of the overall ITOCHU Group by regularly conducting workshops thathone the knowledge and expertise of our personnel, and assessments of labor and human resources.

Details of Personnel and Labor Support Provided to Group Companies
in FYE 2020
1. Labor management case study workshops
These workshops focus on case studies that highlight possible labor management cases including mental healthproblems and working hours management. Participants gain specialized knowledge and learn how to handle
these types of problems. FYE 2020, 25 participants from 17 companies (January and Feburuary)
2. Labor management case study workshops (special edition)
In these workshops, lectures explain key points that are likely to cause problems for human resources and labor
management and propose solutions to these problems. In FYE 2020, the workshop's theme was "Equal Pay",and gathered 104 participants from 61 companies.
3. ITOCHU Group Human Resources and General Affairs Liaison Council
This council aims to allow those in charge of human resources and general affairs from our Group companies toexchange information and strengthen relationships. Activities include discussing the latest trends in humanresources and general affairs, sharing information about ITOCHU Corporation measures and support situation,and updating one another about the content of revisions to laws. FYE 2020, 151 employees participated from 94
companies.
4. Human resources and labor management assessments
These are health assessments aimed at checking whether rules, systems, and management related to overall
personnel and labor affairs are operated in an appropriate manner. These include labor contracts, internal rules,
occupational health and safety, and time management. We conducted assessment of 10 companies in FYE 2020.
5. ITOCHU Group Human Resources and Labor Management Portal Site
We established a new portal site in May 2018 to share the regulations and expertise of ITOCHU with groupcompanies. The aim of this site is to strengthen the human resources and labor management in groupcompanies. By the end of FYE 2020, 61 companies had registered to use this.
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Ensuring Safety in Uranium Exploration
Uranium exploration is one of our business areas that requires careful attention to ensure the safety of employees
and surrounding communities. Our engagement in uranium exploration occurs through JCU (Japan-Canada
Uranium ), in which we have a one-third share ownership. JCU currently owns interest in 13 uranium assets in
Canada, where it conducts uranium exploration. Only one of these assets has completed the prefeasibility study,
with the rest being suspended or still requiring more exploration work. Thorough prefeasibility and feasibility
studies are crucial for us to understand the quantity of potential resources and economic value of each site, as wellas technical and safety-related parameters and concerns. If JCU and its JV partners determine to proceed todevelopment and production in the future, our policy is to continuously conduct meticulous measurements ofradiation levels and implement necessary measures to limit radiation exposure among employees and surrounding
communities to a minimal level. Likewise, it will also be our policy to minimize any risk of emitting low level
radioactive waste.

Peaceful Usage of Nuclear FuelIf JCU and its JV partners determine to proceed to uranium development and production, our policy is to strictly
limit any usage of sold uranium concentrates to peaceful usage. The sole objective of our uranium exploration
business is to contribute to the enhanced power generation for civilian use. Our minimum commitment to achieve
this policy will be to meet any local or international regulations regarding security trade control. Furthermore, wewill implement a chain of custody monitoring structures to ensure peaceful use among our direct customers as wellas any customers involved in further resale.

Radiation Hazard Assessments
All JCU business activities related to uranium exploration are ensured to meet local laws that align with theInternational Atomic Energy Agency's (IAEA) guidelines for uranium development and production regulations. This
includes our commitment to meeting IAEA recommendations and requirements, as well as Canadian local
regulations regarding implementation of radiation hazard assessments and management to ensure its appropriate
execution.

Management of Radiation Exposure to Employees and Communities
If JCU and its JV partners determine to proceed to uranium development and production, ur first and foremost
priority across all activities regarding uranium concentrates will be health, safety, security, and environment(HSSE). It is therefore fundamental for us to implement necessary measures to ensure the safety of employees
and the community – especially those in close proximity to the site. This includes our commitment to meeting IAEA
recommendations and requirements as well as Canadian local regulations regarding measurement of radiation
exposure among all personnel at relevant facilities, cumulative radiation dosage management for employees, andthorough monitoring.
Regarding JCU's uranium exploration activities, throughout the past three years (2016-2018) we have not
identified any cases of radiation levels that exceed natural levels in relation to employees and the community.

Management of Radioactive Operational Waste
All uranium exploration projects we are involved in via JCU aim for the development and production of naturaluranium concentrates. Therefore, any radioactive operational waste occurring from the mine and the refining
facility will predominantly be limited to having naturally-induced low level radioactive wastes. We will commit tomeeting IAEA recommendations and requirements as well as Canadian local regulations regarding the appropriate
management and disposal of these radioactive wastes.
Throughout the past three years (2016-2018), we have not generated any high-level, mid-level, or low-level
radioactive operational waste.

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External Appraisal/Assessment
In FYE 2016 ITOCHU Corporation obtained the highest rank in the Development Bank of Japan (DBJ) HealthManagement Rating System for the first time as a general trading company. We were also selected as a Health andProductivity Stock for two years in a row in 2016 and 2017 in the health and productivity management program
jointly sponsored by the Ministry of Economy, Trade and Industry and the Tokyo Stock Exchange.
We succeeded in these areas thanks to positioning work-style reforms and Health and Productivity Management asimportant management strategies. We introduced a morning-focused working system ahead of other companies,and cooperated with industrial physicians and the Health Insurance Union to promoted aggressive measures for
improving health throughout company.
In FYE 2018 ITOCHU received the Minister of Health, Labour and Welfare Prize during the 2017 Award for
Companies Promoting Cancer Control in the Action Plan for Promotion of Cancer Control, which is sponsored by the
Ministry of Health, Labour and Welfare. The award was granted in recognition of our Support Measures for
Balancing Cancer Care and Work, which began in FYE 2018. We also won an award of excellence, during the Tokyo
Metropolitan Government awards commending companies that implement excellent initiatives to help cancer
patients balance cancer treatment and work.
Our Balancing Cancer Care and Work Support System was acknowledged in FYE 2019. We received the Award of
Excellence in the Corporate Human Resources category at the Nihon no Jinjibu HR Awards 2018. The Nihon no
Jinjibu HR Awards are awards that honor innovators in fields such as human resources, personnel development andlabor management. We also received the Gold Award at the 1st gan-ally-bu Awards. The gan-ally-bu Awards areawards aiming for workplaces and a society where it is possible to work actively while receiving cancer care.

Award for Companies
Promoting Cancer Control in
Health and Productivity Stock

the Action Plan for Promotion

2016-2017of Cancer Control, sponsoredby the Ministry of Health,Labour and Welfare

Selects companies engaged instrategically carrying out initiatives
with regard to employee healthfrom a management perspective(Selected February 2017 / Ministryof Economy, Trade and Industry(METI) and the Tokyo Stock
Exchange (TSE))

This program recognizes
companies that are proactive intaking cancer control measures
and which are engaged incomprehensive, advanced cancer
control measures. (Selected in
February 2018 / Ministry of
Health, Labour and Welfare)* First general trading company to
be selected two years in a row

125Tokyo Metropolitan
Government award
commending companies which
implement superior initiatives
to help cancer patientsbalance cancer treatment andwork
This program recognizes
companies that implement
superior initiative to help
employees with cancer balancetreatment with work. (Selected in
February 2018 / Tokyo
Metropolitan Government)

Sustainability at the ITOCHU Group

Society

Environment

GovernanceNihon no Jinjibu HR Awards
2018
The Best Practice EnterpriseAward of Excellence in the

1st gan-ally-bu Awards

Corporate Human Resources
Category
These awards are held once a year
to select just one company in eachprefecture as The Best PracticeEnterprise that is working
proactively to reduce long working
hours as a part of the overwork
elimination campaign. (November
2017 / Tokyo Labor Bureau)This is an award system that
honors innovators in fields suchas human resources, personnel
development and labor
management. (November 2018)

126

These awards were established torealize workplaces and a society
where it is possible for cancer
patients to work actively while
receiving care. They were
established by the gan-ally-bu
private sector project working on
the problem of cancer andemployment in which employees
work while receiving cancer care.
(October 2018)

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Governance

Respect and Consideration for Human Rights
Action Plan
Risks

Opportunities

Business delay or business continuity risk resulting fromthe occurrence of a human rights problem in businessactivities that expands (geographically).
Decline in credibility that may result from defects in thesocial infrastructure services we provide. And others.

Stabilization of business or securing of excellent human resources
resulting from harmonious coexistence with local communities.
Establishment of safe, stable supply system for product enabledby the consideration of human rights and improvement of work
environment in the supply chain. And others.

Materiality

SDGs
Targets

Issues toAddress

Business
Area

Commitment

Specific Approach

Performance
Indicators

Degree of Progress

Supply chain
management

We will promote informationsharing in the overall Groupand establish a safe, securesupply chain, thereby helping
customers with risk reduction
and contributing tosustainable economic
development.

Make Group-wide efforts toreview the social andenvironmental safety of the
supply chain and make
improvements as necessary,
thereby promoting theestablishment of a safe, securecommodity supply system.

FYE 2024: Establish andvisualize the supply chainof the overall Group, frommaterial procurement tosales, to ensure a
responsible procurement
policy.

We implemented this in 50 companies in Southwest
Asia (e.g., Vietnam and Indonesia) compared to the
80 companies that was our target in FYE 2020.
Separately, we conducted a fact-finding investigationquestionnaire on the status of compliance with theLabor Standards Act and Industrial Safety and
Health Act for foreign technical intern trainees in 211
sewing plants in Japan.

Textile Company

RespecthumanrightsEstablishing a
supply chain
reflecting
consideration
for humanrights and theenvironment

Machinery Company

Water Field

RespecthumanrightsWe own a water supply service business in the U.K.
and Spain and a seawater desalination business inAustralia and Oman. We are continuing to work to
expand our seawater desalination and watersupply/sewerage business.

We will contribute toimproving the hygiene
environment, the development
Improving
Water andof economic activities, and thewater andenvironmental protection of the global
hygieneprojects
environment through theinfrastructuresappropriate treatment andeffective use of water andwaste.

Expand water and environment
projects to promote theappropriate use and treatmentof water and the effective
utilization of resources, andreduce the environmental
impact.

Expand and diversify theinvestment portfolio in thewater and environment
field.

Establishing a
supply chain
reflecting
consideration
for humanrights and theenvironment

Set rules on due diligence
related to social and businessenvironmental safety forsuppliers and business
investment destinations basedon the distinctive characteristics
of each business, implement due
diligence, and strengthen
monitoring continuously.

FYE 2020: Aim to
implement the due
diligence described on theleft in all new
development projects.

We are continuing operations to check the core
subjects in the guidelines on social responsibility
using the company-wide ESG checklist in all
development projects where we are investing for the
first time. We are conducting due diligence on
individual development projects to check their socialand environmental safety based on the uniquecharacteristics of each business prior to investment.

Ensure the thoroughapplication of the EHS
guidelines.
Contribute to local
communities through activities
for improving medical care,education and infrastructure.

Implementation ofannual internal seminars
to ensure our employees
are fully aware of the
EHS guidelines.
Donations to medicalcare, education andbuild infrastructure in
local communities.

We held internal EHS (Environment, Health and
Safety) training courses for supervisors andcompany employees belonging to sections engaged
in resource development. The attendance rate ofthose subject to this training was 100%.
We checked the proper compliance to the EHS
guideline by one new project and eight existing
projects in our mining business, and also by one
another resource-related project.
We carried out activities that contribute to the local
community as part of each project we invest in.
As a special initiative, our Australian subsidiary,
ITOCHU Minerals & Energy of Australia Pty. Ltd.,
together with other local group companies,
contributed A$200,000 in total to the Australian
Red Cross Society as support to recover from thedamage caused by the Bushfires.

Contributing in thedevelopment of local society
by advancing exploration &production projects that
accommodate social andenvironmental concern.

Implementation of projects incompliance with the laws andregulations of the respective
government and internationallyrecognized administrative body.

Be compliant with HSE(Health, Safety andEnvironment) standards
in the respective
government and theones set byinternationallyrecognizedadministrative body.
Reduction of HSE issues
that involve serious
damage to humanbeings and/or
environment.

We are appropriately complying with the HSEmanagement standards of the government andmanagement body in each country.
We are managing the number of incidents, theirseverity and content monthly in accordance within-house regulations. (There have been no serious
operational incidents as of the end of January 2020in this fiscal year.)

We will develop a procurement
structure compliant with thirdparty body certification andsupplier-specific codes ofconduct.

We will promote procurement
compliant with supplier-specificcodes of conduct in coffee bean
producing countries.
We will strengthen thehandling of oil certified by the
RSPO - a third-party
certification organization forpalm oil.
We will support theestablishment of a promotion
and distribution system inJapan for MSPO/ISPO incooperation with domestic
industrial associations. The aimof this is to encourage the useof certified oil systems inproducing countries.

Coffee beans: Promotionof procurement
compliant with supplierspecific codes of conduct
in our bases in
producing areas incooperation with
suppliers.
Palm oil: Promotion ofprogress information
disclosure upon also
clarifying the KPI
indicators by publishingour procurement policy.

We are currently giving guidance to producers ineach producing area country to meet thecertification standards. The aim of this is to expand
transactions for certified coffee beans (e.g., thoseof the Rainforest Alliance and C.A.F.E Practice).
We have published our procurement policy with ourstarted target of switching all the palm oil we
procure to sustainable palm oil supplied fromsupply chains compliant with RSPO/MSPO/ISPO by
FYE 2026. We are promoting the construction of
procurement and supply structures in light ofindustry trends and the situation in suppliers.

We will contribute to increased
employment and an improved
living environment byfostering local industries.

We will cultivate new producing
areas. We will do this to expand
employment and improve theliving environment throughdiversification of producing
areas in light of weather risks
and through the development oflocal industries in our Dolebusiness.

Overallelectric power
and plant
projects

We will contribute toimproving the quality of life of
all stakeholders in the supply
chain and business investment
destinations.

Environment Field
We operate four waste incineration and power
generation business projects in the U.K. In
addition to this, we entered into a financing
contract for a public-private partnership (PPP)
waste disposal power generation project inBelgrade, Serbia in September 2019. We areaiming for operation in 2022.

Metals & Minerals Company

RespecthumanrightsSustainablemine
developmentthat reflectsconsiderationof the risks in
occupationalsafety andhealth andenvironmental
risks, and that
contributes to
local
communities

Miningbusiness

We will promote sustainable
development of natural
resources by fullycommitting to EHS(environment, health,occupational safety) andharmonious coexistence withlocal communities in areas
which we operate.
We will improve local
infrastructure such as
medical care and education.

Energy & Chemicals Company

RespecthumanrightsEstablishmentof an energy
resourcesdevelopment
system that
goes well withlocal society
andenvironment

Exploration &Production of
Oil & Gas

Food Company

Provisions
field

RespecthumanrightsEstablishing a
supply chain
reflecting
consideration
for humanrights and theenvironment

Fresh food
field

127

Aim for the start of thecommercial productionand export of pineapple
processed foods in FYE
We are promoting the expansion of a pineapple farm
2022 by cultivating
and the construction of a pineapple processed foodpineapples in Sierra Leone manufacturing plant in Sierra Leone.
as the cultivation of a
producing area followedby the development
program in the Philippines.

Sustainability at the ITOCHU Group

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Policy and Basic Concept
Human Rights Policy of the ITOCHU GroupThe ITOCHU Group has adopted the "ITOCHU Group Human Rights Policy" (hereinafter "the Policy"), drafted
based on our Corporate Mission, Code of Ethical Conduct, and The Basic Policy on Promotion of
Sustainability. This Policy iterates our commitment to respect the human rights of our stakeholders andaddress negative impacts that may arise from our business activities.

1. Policy Scope and Our Expectations Toward Business Partners
This Policy applies to all worldwide executives and employees of the ITOCHU Group, including
contractors and temporary employees. The ITOCHU Group also expects business partners and otherrelevant stakeholders to comply with this Policy.

2. Endorsement of International Agreement
The ITOCHU Group supports international agreements on human rights, including the Universal
Declaration of Human Rights, the International Labour Organization's Declaration on Fundamental
Principles and Rights at Work, and the United Nations Global Compact, which we have been a signatory
to since 2009. We will also implement measures aligning to the United Nations Guiding Principles on
Business and Human Rights.

3. Legal Compliance and Respect for Internationally Recognized Human Rights
The ITOCHU Group will comply with the laws and regulations in the respective countries and regions
where we perform our business activities in addition to Japan. If there is a contradiction between
internationally recognized human rights and the laws and ordinances of a country or region, we will
pursue a method to maximize respect for international human rights principles.

4. Management Approach
The ITOCHU Group will build structures to realize this Policy. The Sustainability Officer will bear the
responsibility to oversee the compliance and implementation situation of this Policy.

5. Human Rights Due Diligence
Based on the United Nations Guiding Principles on Business and Human Rights, the ITOCHU Group will
implement human rights due diligence in order to identify, prevent and mitigate negative impacts onhuman rights and fulfill our commitment to accountability.

6. Remedy and Rectification
If the business activities of the ITOCHU Group induce a negative impact on human rights or if
involvement in such becomes clear, we will strive to remedy and rectify that through appropriate
procedures and dialogue.

7. Dialogue and Consultations
The ITOCHU Group will leverage external human rights expertise in its implementation of human rights
due diligence and will engage in dialogues and consultations with our stakeholders – especially thosepotentially subject to adverse impacts from our business activities.

8. Education and Awareness
The ITOCHU Group will provide appropriate education to all executives and employees (including
contractors and temporary employees) and strive to raise human rights awareness in order toincorporate and implement this Policy in our business activities.

9. Communication on this Policy and Our Relevant Initiatives
This Policy will be approved by senior executive in charge of sustainability and be reported to our Boardof Directors and we will widely publish it to the public. We will also report on our human rights initiatives
based on this Policy on the ITOCHU website and in our ESG Report.
April 2020
Fumihiko Kobayashi
Member of the Board
Senior Managing Executive Officer
Chief Administrative Officer
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GovernanceIndividual Policy
Respect and consideration for human rights is an important issue for ITOCHU as we deploy our business activities
in various regions around the world. ITOCHU also asks all our stakeholders to approve, understand and put into
practice the human rights policy of ITOCHU in addition to education for employees to respond to this important
issue.

Response to Modern Slavery and Human Trafficking
ITOCHU is committed to initiatives to ensure that there is no modern slavery or human trafficking in our supply
chain and business activities. We are participating in the United Nations Global Compact. Together with this, we arereflecting the concept of the United Nations Guiding Principles on Business and Human Rights in our businessactivities. The existing principles of ITOCHU contain initiatives to ensure that modern slavery and human trafficking
do not occur in our sales activities and supply chain across the world.
* Reference︓Status of Initiatives at ITOCHU Europe PLC. (Slavery and Human Trafficking Statement)(https://www.itochu.com/uk/en/sustainability/#ModernSlavery)

Consideration for Foreigners
If foreign workers, interns and trainees are accepted in our supply chain, we pay full attention so that we comply
with the labor related laws and ordinances in the country concerned and so that we do not commit acts contrary to
the purpose of that acceptance system. We do this from the point of view of respect for human rights and relief
because such people are liable to become the target of illegal acts due to their low social and economic status.

Respect for the Rights of Children
ITOCHU supports the United Nations Convention on the Rights of the Child and Children's Rights and Business
Principles. We respect the four pillars of the United Nations Convention on the Rights of the Child - a child's right tolife, development, protection and participation.
ITOCHU has adopted the development of the next generation as one part of our Basic Activity Guidelines on Social
Contribution. We perform activities to support the healthy development of the young people who will be responsible
for the next generation.
Related activities can be found at "Growth of Future Generations(https://www.itochu.co.jp/en/csr/social/future/index.html)".

Security Company Appointment Concept
The United Nations adopted the Code of Conduct for Law Enforcement Officials in December 1979. This aims toensure that member states thoroughly implement and promote the appropriate roles of law enforcement officials(e.g., the police and military authorities) and respect and protect the dignity of humans while carrying out theirduties. ITOCHU supports the Basic Principles on the Use of Force and Firearms by Law Enforcement Officials inwhich the United Nations has established the principles on the use of firearms by law enforcement officials under
the above code of conduct. We select security companies according to the content of that.

Respect for the Rights of Indigenous People
We recognize that indigenous people have their own culture and history when we conduct business activities inregions where indigenous people live as part of our commitment to respect human rights. We respect and take into
consideration the rights of indigenous people established in the laws of the countries and regions where we
perform our business activities and international agreements (e.g., the Declaration on the Rights of Indigenous
Peoples and the International Labour Organization (ILO) Convention 169). When examining new business
investment projects, we also strictly enforce prior checks concerning the impact on the rights of indigenous people
by that business.
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Governance

Structures and Systems
ITOCHU promotes the formulation and implementation of action plans with respect and consideration for humanrights serving as one of our key issues. Under the sustainability promotion structure, the person responsible forthis issue is the Sustainability Officer while the Sustainability Management Department serves as the secretariat.
The secretariat performs a review every year together with the persons responsible for ESG in each division. This
content is deliberated on and reported to the Sustainability Committee. Important matters are also discussed andreported to the Board of Directors.
* Reference︓Sustainability Promotion Structure Chart (P9)

Human Rights Due Diligence
Initiatives
The ITOCHU Group is fulfilling our responsibility to respect human rights based on the Human Rights Policy of the
ITOCHU Group we formulated in April 2019. Specifically, we identify and evaluate the negative impact from thecorporate activities of the ITOCHU Group on human rights that may affect society. We then work to prevent andmitigate that through appropriate means. In addition, we disclose information on the progress and results of ouraction. In FYE 2021, we started building human rights due diligence process in our Food Company that greatly
contributes to maintaining a safe and stable lifeline for consumers.

New Business Investment Projects
For more details, please refer to "ESG Risk Assessment for New Business Investment Projects (P152)".

Existing Business
When entering into business with new suppliers, ITOCHU informs all applicable suppliers in advance of the
Sustainability Action Guidelines for Supply Chains. If a matter in violation of the purpose of this policy is confirmed,
we seek corrective measures from that supplier. At the same time, if it is judged that correction is difficult eventhough we have made continuous requests for correction, we deal with this under a stance of reviewing ourbusiness with that supplier.
We also perform due diligence with the seven core subjects of ISO26000 serving as the mandatory survey items(including modern slavery and human trafficking) when making new investments with major suppliers. We conduct
additional due diligence with external specialist organizations for investment projects requiring a professional pointof view.

Supply Chain Management
For more information see Sustainability in the Value Chain (P150-151).

Risk Assessments
We conduct risk assessment on human rights including modern slavery and human trafficking. We do this throughgroup company fact-finding surveys in which we visit sites together with external experts as appropriate. This is inaddition to our supplier surveys in due diligence. We have also established policies and responses for procurement
by product in regards to products with a significant impact on society and the global environment. This is anattempt to reduce the risks in our supply chain.
* Reference︓Human Rights Audits in the Poultry Industry in Thailand (P151)

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Society

Environment

GovernanceConsultation Desk
Employee Consultation Desk
We have established an employee consultation desk called
7830 (Nayami Zero) to respond to worries andconsultations from each individual employee. We have also
posted the HR Help Guide Book on the Intranet and havewidely informed employees about the consultation desk.
This means we have established a structure in which it ispossible for employees to consult with us.

HR Help Guide Book on the Intranet

Career Counseling Center
ITOCHU established our Career Counseling Center ahead of other companies. This office accepts workplace culture,human relations, treatment and harassment related consultations in addition to consultations on the careers ofindividuals by telephone, fax, e-mail and the post. Full-time office employees deal with these consultations.

HotlineIn addition to a direct hotline to those responsible for compliance in each division, we have also establishedmultiple desks to receive reports not only from our employees but also from the group companies and those whohave contracts with ITOCHU both in Japan and overseas as ITOCHU Hotline System. These include external desks
to receive reports by specialized operators and by external lawyers.. Our hotline system prohibits unfavorable
treatment (e.g., retaliation) against internal information reporters. It also accepts information reporters to makereports anonymously.
Flow of Report131Sustainability at the ITOCHU Group

Society

Environment

GovernanceConsultation Desk for the General Public (including Stakeholders)
ITOCHU Corporation has established a system to accept opinions, proposals, and grievances and to accept inquiries
from the general public and all our stakeholders, as described below.

Inquiries
https://www.itochu.co.jp/en/inquiry/index.html

Initiatives
Implementation of Fair Recruitment
Human resources are the greatest management resources for ITOCHU - a general trading company deploying avariety of businesses around the world. ITOCHU conducts activities to recruit those newly graduating fromuniversities and graduate schools every year. The table below gives our recruitment record over the last three
years.

Number of Hires by Gender★

(Unit: persons)New-graduates

Mid-career
Total

Male

Female

Total

Male

FemaleTotal

FYE 2021*

84

36

120

FYE 2020

98

31

129

4

6

10

139

FYE 2019

103

35

138

11

4

15

153

* The figures as of April 1st, 2020
We also offer internships (work experience workshop) every year separate to our recruitment activities. The aim ofthese internships is to provide support to university and graduate school students in forming their careers. We
provide opportunities to deepen knowledge about the business of trading companies and about working in a trading
company.
ITOCHU recruits employees chiefly on the basis of their personal character. We recruit employees fairly andimpartially without concern for their age, gender, nationality or otherwise. We have provided human rights
education with lecturers from the Tokyo Metropolitan Human Rights Promotion Center and have also reflected that
content in our interviewer education. We have also established a watchdog system in which employees are selected
and notified to serve as watchdogs to establish a fair recruitment screening system.
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GovernanceTraining
We raise awareness about the relationship between our corporate activities and human rights in our various
internal training programs. We develop the mind to respect human rights that should be possessed as an ITOCHU
person in our new employee training. For example, we hold training to acquire consideration for nationality, age
and gender (including sexual minorities such as LGBTs) from the basic concept of human rights and points ofconcern. We raise the problem of sexual harassment (including discriminatory behavior and harassment toward
sexual orientation and gender identity) and abuse of authority in internal training aimed at organizational heads.
We provide education and instruction for measures when harassment has actually occurred and when we havereceived reports of such. We strive to create an environment that does not allow harassment on a daily basis.
Through these initiatives, we are aiming for a thorough understanding toward human rights. We are also striving toraise awareness in various regions by looking at consideration for human rights in our supply chain in pre-overseas
assignment training. There were 720 participants in our human rights training in FYE 2020.

FYE 2020 Human Rights Training Record(Unit: persons)No. of Participants

New employee training

129

Organization Manager Workshop

337

Training for newly appointed section managers

62

Pre-overseas appointment training254

In addition to the above training, we made business and human rights one of the themes in our sustainability elearning in FYE 2020. Please see the Spreading Sustainability at Itochu page (P25-26) for more details.

Sustainability Seminars
We have continued to hold internal seminars since FYE 2008 on human rights issues. The aim of this is to adopt
insight and opinions from those outside the company. We made business and human rights (in the supply chain) atheme in FYE 2019.
We conducted awareness activities for business and human rights. The purpose of these was to learn about thelatest trends concerning corporate activities and human rights problems and to make use of that in our business asa general trading company which deploys various businesses across the world and which plays an important role inthe supply chain.
Seminar Details (P26).

Various Publications
We are endeavoring to raise awareness of human rights. The aim of this is to ensure that human rights violations
do not occur in the workplace. We are doing this through various publications that we distribute to all our
employees.
We convey our basic concept on respect for human rights through the ITOCHU Group corporate code of ethicalconduct and Human Rights Policy of the ITOCHU Group to all our employees.
We call on our employees not to induce human rights violations in business in our compliance handbook. We do
this by establishing pages on respect for human rights and harassment with concrete examples.
We have prepared a handbook on communication with our suppliers. We deploy a check mechanism in whichthose in charge of surveys can understand the actual state of the management of human rights and labor
practices in important suppliers more clearly and so that they can then offer advice on making improvements.
At the same time, we utilize this in keeping our employees informed.

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Society

Environment

GovernanceCountermeasures Against Harassment
ITOCHU is raising awareness on the importance of making systems well-known and engaging in communication
through organizational head training. We are doing this so that pregnant employees and employees perseveringwith their work while being engaged in childcare and nursing care can also contribute to their workplaces with asense of their work being worthwhile. This is without employees in the workplace being subjected to abuse of
authority or sexual harassment (including disadvantaging and harassing employees who are applicable to sexual
minorities). Superiors encourage employees with restrictions due to balancing their work with childcare or nursing
care to make use of the related systems appropriately. In addition to this, we are also ensuring employees are fully
informed about the importance of reviewing work content, work division and work styles over the entire workplace.
Furthermore, we have thoroughly established a workplace environment which does not allow discriminatory
remarks relating to sexual orientation or gender identification and remarks made under unconscious assumptionsof gender segregation. We have also established a desk to receive consultations from employees.
The following are clearly defined as prohibited acts in human rights violations under the work regulations:discrimination relating to work by race, gender, religion, creed, nationality, body, illness, age or any other irrational
reason; sexual harassment (including discriminatory behavior and harassment relating to sexual orientation andgender identity); and workplace bullying. The regulations stipulate disciplinary action to be taken against such
behavior.

Foreign Technical Intern Trainee Survey on Working Environment
ITOCHU Modepal, a subsidiary to ITOCHU under the Textile Company,
conducted a survey on its domestic production contractors, whichconstitutes of 211 sewing factories. The survey inquired whether or not
the contractors were employing foreign technical intern trainees, and if
the contractor answered affirmatively, continued to ask how it manages
legal compliance to labor standards and health and safety standards
specifically regarding the foreign trainees. The latest survey results
showed that there are no cases of non-compliance to relevant laws andregulations.
Seminar on "Sustainability Promotion
In order to facilitate the survey and enhance its results, ITOCHU's head
and Foreign Technical Intern Trainees"
office sustainability management department held a seminar for sales
representatives and production managers prior to sending out the questionnaire. The seminar, entitled"Sustainability Promotion and Foreign Technical Intern Trainees", aimed to enhance participants' understandings ofhuman rights risks and how to mitigate them.

ITOCHU will continue to make Group-wide initiatives in identifying risks along the value chain that can potentiallylead to human rights violations, and strive to uphold its commitment to respecting human rights.

Cooperation with Stakeholders
Participation in Workshops on Human Rights Issues
Business and Human Rights Training: Effective Stakeholder Engagement
Supply Chain Labor and Human Rights Audit (Practical) Training (Lloyds's Register Japan)
Caux Round Table
Human Rights Education Subcommittee (GCNJ)

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Society

Environment

Governance

Responsibilities to Customers
Action Plan
Risks

Opportunities

Decline in credibility that would result from the occurrence of a problem
related to the safety or health of consumers and service users.

Increase in demand for food safety and security andhealth improvement.

Materiality

SDGs
Targets

Issues toAddress

Business Area

Commitment

Specific Approach

Performance
Indicators

Degree of Progress

Sales of Cutting-Edgemedical devices andprovision of medical
services

We aim to improve
quality of life byproviding cutting-edge
medical devices andadvanced medical
services in the field of
medical care, where
technologies areinnovated rapidly.

Promote sales ofadvanced medical
devices, such as MRIguided radiation
therapy systems, andthe business of
supporting theoperation ofdesignated regional
cancer care hospitals.

Increase the penetrationof advanced medical
devices in Japan, suchas MRI-guided radiation
therapy systems.

Currently operating at National Cancer Center and Edogawa
Hospital. More than 300 patients are treated including
intractable cancer (ex. pancreatic cancer). Since thetechnology is promising, Edogawa Hospital is now upgrading
the system, which expected to operate in December 2020.
With joint research with the National Cancer Center, we areon the way to establish the standard procedure to cure
intractable cancers.

We started selling a non-absorptive liquid to protect against
oral mucositis (a liquid that controls and relieves the pain oforal mucositis caused by chemotherapy or radiotherapy
when treating diseases such as cancer) in group companies(from May 2018 in Japan, from July 2019 in China andscheduled for sale in the future in Korea).
We started full-scale sales with FDA approval in North
America of a pain reliever through group companies (fromMarch 2018).
We started the sale in China of a percutaneous absorption
5-HT3 receptor antagonist (therapeutic medication for
nausea and vomiting during cancer treatment) (from March2019). This drug has been newly listed as a treatment
choice in the Guidelines for the Treatment of Nausea andVomiting During Cancer Treatment (published by the
Chinese Society of Clinical Oncology in June 2019).

Machinery Company

Contributeto healthierand moreenriched
lifestyles

Promotinggood healthamongpeopleEnergy & Chemicals Company

Contributeto healthierand moreenriched
lifestyles

Promotinggood healthamongpeoplePharmaceuticalproducts

Contributing to theimprovement of people’s
health and working
environment throughaccelerating thedevelopment ofpharmaceuticals andother products in fields
with significant needs
including cancer-related
fields.

Actively promoting tosupport thedevelopment andmarketing of newpharmaceutical andother products.

Aiming to obtainapprovals in Asia andNorth America for new
pharmaceutical andother products of which
we are engaged insupporting thedevelopment, and tolaunch them into themarket.

We will select andconcentrate on suppliers
who are capable ofmanufacturing andsupplying safe, secure
food stably.

Increase the numberof persons withinternational
certifications/
qualifications related
to audit the Food
Safety Management
System (FSMS) toenhance the capabilityof human resources
for selecting suppliers.

Promotion of theappropriate appointmentof the auditors in eachsales division under theguidance of the ITOCHU
food safety
management
organization.

Food Company

Contributeto healthierand moreenriched
lifestyles

Supplyingsafe, securefoodOverall food-related
businesses

The number of people who have acquired the assistant
auditor increased by one in FYE 2020. We plan to increase
this by two people in FYE 2021. We expect the total numberof qualified persons over our entire group to reach nine.

ICT & Financial Business Company

Contributeto healthierand moreenriched
lifestyles

Promotinggood healthamongpeopleSupportpharmaceuticaldevelopment
projects
Business ofproviding healthcare management
solutions forindividuals

We will provide valueadded services forpharmaceuticals andmedical sites, and will
We will optimize
contribute tohealthcare utilizing
improvement of people's medical data.
Quality Of Life (QOL) by
utilizing cutting-edge
ICT tools.

Realization of newservices and businessdevelopment relating
to medical data
Expansion of existing
business (number ofpeople subject tohealth checkup data
management to reach1 million by the end of
FYE 2021)

With the interest to maintain and promote health continuing
to grow in company employees, the number of persons
subject to health checkup data management is steadily
increasing. We expect this to reach 750,000 persons by theend of FYE 2020.
We have carried out investments including, SaaS for
dispensing pharmacies, dentistry-related data, genomic
data and pharmaceutical data. We will contribute toimprove the quality of life with highly efficient operations byutilizing the aforementioned data.

Policy and Basic Concept
ITOCHU, which engages in multifaceted corporate activities in a wide range of fields in various regions around theworld, believes that meeting the expectations of society through our business activities will maintain sustainability
and lead to further growth.
ITOCHU has limited direct access to consumers in much of our business due to our characteristics as a trading
company. Nevertheless, we recognize the importance of quality and safety management. We fulfill our
responsibilities to customers by promoting initiatives to ensure this concept penetrates into the value chain.

Product Safety
ITOCHU complies with our obligations as stipulated in safety related laws and ordinances for the products wehandle. We are striving to ensure safety by formulating product safety manuals for each company based on ourpolicy of providing even safer products with greater peace of mind to our customers. We will continue to work on
providing safe products with peace of mind in the future. We will do this while promoting internal education, setting
up departments responsible for product safety, establishing information transmission routes and reviewing our
response in the event a product accident does occur. For related initiatives, please refer to "Sustainable
Procurement: Policies and Initiatives by Product Type (P154-167)".
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Responsible Marketing
We engage in responsible advertising and marketing that fully takes into account our social responsibility. We do
this under our Corporate Mission "Sampo-yoshi", the ITOCHU Group Corporate Guideline of Conduct, "I am Onewith Infinite Missions," and our Code of Ethic Conduct. We accept expectations and requests from society throughtwo-way dialogue with stakeholders. We then put them into practice.

Advertising
We have unified the visual image of ITOCHU to improve and ensure the penetration of our brand image tocustomers. Internal regulations have been developed to advertise and perform publicity with the appropriate
expressions, content and media. We also give due consideration to slander, discriminatory expressions,
exaggerations and false representations, religious and political beliefs, the environment, third party privacy,
personal information and intellectual property rights. This is done in accordance with our sustainability policy. We
promote appropriate advertising and publicity initiatives by sharing knowledge on advertising and publicity
activities through regular meeting for our group companies.

Marketing
We are thoroughly committed to creating content and expressions that do not cause misunderstanding and which
do not infringe upon the rights, credibility and honor of others. This is done under relevant laws and ordinances,
our internal regulations, various internal training programs and our company-wide compliance structure. We carryout responsible marketing activities by emphasizing dialogue with the various stakeholders around us in thediverse business activities we deploy on a global scale.

Individual Policy
Safety of Food Products
The Food Company is engaging in food safety management based on the following mission and activity guidelines.

Philosophy
FOR THE NEXT GENERATION

Mission
1. To contribute to the sound development of society while gaining strong trust from consumers
2. To provide health and happiness to people by realizing rich food lifestyles through the stable supply of safe food
3. To contribute to the interests of consumers, business partners, shareholders and employees through faircorporate activities

Activity Guidelines
The following serve as the concrete activity guidelines to achieve our basic philosophy and mission. We comply withlaws and ordinances and the ITOCHU Group corporate mission and code of ethical conduct. We then thoroughly
inform all relevant employees in the Food Company about these. Upon doing that, we engage in food safety
management and fair business which form the basis of trust from consumers.
The Food Safety and Compliance Management Office gives instructions and guidance on the above in the Food
Company Group.

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Governance

Responsible Food Business: Commitments and Policies
The ITOCHU Group aims to support people's lives by providing various products and services. In doing so, we aim
to ensure the best quality in our offerings by comprehensively managing the entire supply chain of our products
and services, from the procurement of raw materials to the retailing of finished products. In keeping with thisbusiness approach, our Food Company consists of three divisions: the Provisions Division, the Fresh Food Division,and the Food Products Marketing & Distribution Division. The three divisions are designed to allow us to develop avalue chain that caters to consumer needs, is ensured to add top-quality value, and seamlessly connects various
processes, from the development of food resources, the supply of raw resources, production and processing,
midstream distribution, and retail. Our Food Company synergizes these business aspects throughout the Japanese,
Chinese, and greater Asian markets. At the same time, by continuously improving and refining our management
and controls around food safety, we aim to become a leading company in the global food industry.
ITOCHU Group takes a market-oriented approach, incorporating the needs and expectations of the market andconsumers as an integral part of our business model. Our food retailing business, which includes FamilyMart, is no
exception. We first and foremost consider the needs of our customers, and based on key insights we draw frommarket and consumer trends, we build our strategy and approach. This allows us to build a value chain that adds
value from the procurement and production of raw materials, to the development and manufacturing of products.
As for our food business, we identify the issues noted in the table below as material topics that especially require
our careful management to provide safe and reliable food products. It is subsequently our policy to commit toaddressing each of these issues.
Material Issue

Description

Management Approach

Reducing negative productimpact of food products oncustomers

Ensuring the safety of imported foodproducts, processed foods, and fresh foodproduces (e.g. managing issues regarding
pollution, pesticide residues, abnormal
prions, additives, and genetic
modification)

Self-management system forfood safety
Assessments for supplier's
management systems in place
to ensure food safety (factoryinspections and audits)

Responsible advertising,marketing, and promotion offood products

Provision of information regarding foodallergies and additives.

Management rules for theregistration of food labels
Improvement initiatives
regarding checks andverifications of food labels
Training certified personnel
regarding food labelingResponsible advertising,marketing, and promotionof alcoholic beverages

Provision of information regarding theprevention of drinking among minors andpregnant womenInternal education programs on theliquor tax law

Access to better nutrition

Medical Foods – a service catering tohome care patients
Providing nutritiously balanced
solutions to the elderly

Cooperation with regional hospitals
and nutritionist organizations

Improving Access to Better Nutrition
As part of its commitment to realize a high-value-adding business, one of our major concerns in the food businessarea is access to nutrition.
In developed countries, aging society is a pervasive issue. Elderly populations with unbalanced nutrition or lack ofnutrition are increasing, straining medical budgets as well as caregivers. Furthermore, for conditions such as acuteforms of diabetes and liver disease that require home care, there is a widespread need to secure nutrition balancesthat are healthy, nutritious, and prevent obesity.
At one of our subsidiaries, FamilyMart, we sell Medical Foods to home care patients that require dietary limitations
due to conditions such as acute diabetes and liver diseases. Through our Medical Foods service, customers
including those elderly can gain access to lunch deliveries that aim at the improvement of their nutrition.
Furthermore, based on thorough consultation with certified nutritionists, we provide heal support products such as
nutritious products that limit calorie and salt intake, health enhancement products that supplement the body withlactic acid bacteria and dietary fibers, and health enhancement products that limit the body's intake of excessive
sugar or salt.
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GovernanceFurthermore, we recognize that in developing countries, hunger and malnutrition are socially important issues
caused by various elements including poverty. At ITOCHU Group, in order to take action in solving these issues wehave implemented various initiatives. For example, we provide financial support to the World Food Programme(WFP) and working with Table for Two (TFT), which aims to alleviate the dietary inequality between developed anddeveloping nations. In this way, we aim to provide high quality, nutritious food solutions to the children ofdeveloping countries.
Throughout the initiatives introduced above, we provide products and services and engage in community
investment activities to support the nutrition and health of people in and out of Japan. We will commit tocontinuing these initiatives to enhance self-care, reduce medical expenditure, and provide healthy food options tochildren living in poverty, to contribute to solving issues of access to better nutrition among underprivileged
groups.

Safety of Pharmaceuticals and Responsible Marketing
Pharmaceutical Quality and Safety
We contribute to the fulfillment of medical needs by delivering a stable supply of pharmaceutical raw materials andproducts at the level of quality required of pharmaceuticals. Additionally, we will satisfy latent medical needs byworking on clinical development in new drug development to enable treatment of heretofore difficult-to-treat
diseases. Our main market is Asia, including Japan, but we will also work on procurement and sales in Europe andthe United States. We ensure safety in product supply and clinical development in accordance with Pharmaceuticals
and Medical. Devices Act.

Pharmaceutical Ads and Labels
Final pharmaceutical products are sold only to licensed companies. We do not engage in advertising. We are taking
necessary measures to ensure appropriate product labeling throughout the manufacturing and deployment process
in legal compliance with the Act on Securing Quality, Efficacy and Safety of Products Including Pharmaceuticals andMedical Devices.

Structures and Systems
Quality Management
With the diversification of dietary habits, the globalization of food distribution, and a growing awareness regarding
health issues, consumers are increasingly paying attention to the safety and security of their food. At the sametime, there have been cases of incidents and problems threatening food safety, such as those regarding Bovine
Spongiform Encephalopathy (BSE), residual pesticides, and the distribution of foods using unauthorized additives.
Our Food Company addresses these concerns and ensures measures are taken to prevent issues by establishing aquality control system overseen by its Food Safety and Compliance Management Office.The Food Quality andCompliance Management Team is responsible for addressing the following issues:
1. Facilitation of the Food Company and their respective domestic and overseas subsidiaries in their initiatives todesign a food safety self-management system.
2. Management of the labeling, safety, and trade-related issues of our food products.
3. Provision of education and training to employees regarding food safety.
4. Provision of training to members of our food safety management team in China.
5. Enhancement of the food safety management audits and subsequent corrective guidance for subsidiaries andsupplier factories.
In addition to the above, the Team is responsible for management of trade and logistics, management ofcompliance related issues, and CSR/environmental activities.

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GovernanceSupplier Management Audits for our Food Business
Due Diligence for New Suppliers
When the Food Company conducts business with a new business partner, the Company is required to assess thepotential supplier's management level of the manufacturing process, and whether it has received certification fromwell-recognized institutions such as the ISO22000. In doing so, we use an internal assessment criteria that isdesigned to evaluate practices around food safety management.

Securing the Safety of Food through Regular Audits of Overseas Suppliers
ITOCHU established the Food Safety Management Office (now: Food
Safety and Compliance Management Office) in the Food Company in
FYE 2003. We are taking wide-ranging measures to ensure safety in thefood business. As part of this, we have been conducting regular visits
and audits of the food processing factories of overseas suppliers forimported food since FYE 2012.
The sales department is responsible for appointing an employee, local
staff, or group subsidiary employee to perform site visits and audit thesafety management system at least once a year. The frequency andtiming as well as the specific sites subject to audits are agreed upon
Food Audit
with the local factory, with consideration given to specific circumstances
as the supplier's local laws, management capability, product, and hygiene-related risks associated to the
manufacturing process.
Auditors are required to reference a Plant Audit Check Sheet that we have originally devised, which incorporates
elements of well-known international food safety standards such as Codex HACCP, ISO22000, and FSSC22000. Any
points of improvement identified through the checklist are appropriately addressed, and necessary corrective
measures are ensured to be communicated. In addition to the above, we set up a new China Food Safety
Management Team in Beijing in January 2015. The aim of this is to strengthen the safety management of foodimported from China in particular. We have been dispatching a member of our Japanese staff with a wealth ofpractical experience in factory audits (IRCA* ISO22000 lead auditor) as a trainer. Through this, we have beenbuilding a management structure at a comparable level to that required in Japan. In addition to regular audits by
Chinese supervisors, we are increasing opportunities for mutual confirmation through follow-up audits to ensure
continuous improvement.
The systematic implementation of hygiene management according to HACCP is scheduled to begin with the recent
revision to the Food Sanitation Act in Japan. We are considering expanding the sites we will visit and audit along
the food chain in accordance with the sites subject to management in this system.
* International Register of Certificated Auditors
For overseas suppliers, our factory audit procedure and results are as follows:

Factory Audit Procedure
Process

Description

Target and frequency settings

The responsible sales department and the Food Safety and ComplianceManagement Office determines the frequency of audits for each factory
identified as a manufacturing plant for imported food, in accordance with laws
and regulations of the relevant country. The decision of the audit frequency
considers specific circumstances such as the supplier's local laws,
management capability, product, and hygiene-related risks associated to the
manufacturing process.

Conducting the factory audits

The sales department is responsible for appointing an employee, local staff, orgroup subsidiary employee to perform site visits and audit the safety
management system at least once a year based on the frequency setting over 150 plants are currently subject to these site visits.

Issuing a findings report andrequesting corrective
measures (as per necessary)

The final report must be created in line with the GFSI/Global Market Program
Ver 1 factory audit framework.

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GovernanceRegular Audits to Ensure Food Safety
FYE 2018

FYE 2019

FYE 2020

On-site audit performance (number of companies)

186

196

197

Regular audits and follow-up audits in China (number of audits)

54

57

45

Subsidiaries that have ISO22000 or FSSC22000 Certifications
Furthermore, we also ensure food-related safety among our direct subsidiaries by implementing a management
system that aligns to well-known international frameworks on food safety, such as Codex HACCP, ISO22000, andFSSC22000.
Japan Nutrition Co., Ltd.

Mirai Shiryo Co., Ltd.

Prima Meat Packers, Ltd.

Fuji Oil Holdings Inc.

Sho-wa Co., Ltd.

ITOCHU Sugar Co., Ltd.

DOLE ASIA HOLDINGS PTE. LTD.

PT. ANEKA TUNA INDONESIA

PT. ANEKA COFFEE INDUSTRY

Staff Education and Training to Ensure Compliance to Responsible
Advertising, Marketing, and Promotion Standards and Food Safety
Standards
We provide e-learning as an education and training program to ensure responsible advertising, marketing, andpromotion of food products, and compliance to food safety standards. We are looking to raise awareness andimprove knowledge about responsible marketing, food safety, and compliance with relevant laws and regulations
among employees. Furthermore, given the expansion of our food business and the subsequent increase in our
auditing scope, we are also invested in training personnel capable of site audits.
Food safety and responsible advertising, marketing, and promotion
Main content

ComplianceInternal regulations and manuals
ESG
All employees in the Food Company (including part-time workers, temporary

Those subject toworkers, employees seconded from the company and employees seconded to thetaking the educationcompany)

and training

All employees in the Food Management Support Corporation (subsidiary tocomplement the functions of the Food Company)

Performance of Staff Education and Training to Ensure Compliance to Responsible
Advertising, Marketing, and Promotion Standards and Food Safety Standards
FYE 2018
Number of trainees
Attendance rate

FYE 2019

FYE 2020

699

754

771

99.9%

100%

100%

We will continue to provide this education and training with the aim of ensuring that knowledge becomes reliably
entrenched.

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GovernanceParticipation in Food Safety-Related Initiatives and Organizations
At ITOCHU Group, we aim to maintain and enhance our quality management to ensure that we supply safe andreliable processed foods. In doing so, we make sure to cooperate with external parties and are members toindustry groups in order to engage in knowledge sharing and collaboratively work toward enhanced solutions.

Association for the Safety of Imported Food, Japan (ASIF) (Japanese only)(http://www.asif.or.jp/)
A group of concerned companies involved with importing, manufacturing, distribution, and sales formed ASIF in
November 1988, beginning to work towards solving imported food safety issues. These activities led to the ASIF
receiving permission from the Ministry of Health, Labour and Welfare in September 1992 to become anincorporated association. ASIF received authorization to become a public interest corporation on April 1st, 2011.
ASIF is involved in a wide variety of activities to support food vendors in fulfilling the social responsibility of"delivering safe and secure imported foods."
In order to promote food safety, the ITOCHU Group collects information on the safety of processed food andperishable food regarding imported food product – e.g. imports, contamination, pesticides, abnormal prions,additives, and genetic modification – from the Association for the Safety of Imported Food of Japan. This
information is reflected in our voluntary food safety management system as well as our supplier food safety
management system (which includes factory inspections and audit).

Japan Food Hygiene Association (Japanese only) (http://www.n-shokuei.jp/)
This association was established on November 1st, 1948 as a collaborative initiative between private companies in
the food sector and administrative organizations regarding the food hygiene law in order to enhance self-regulationin the market. The establishment of the organization shortly followed the enactment of the food hygiene law in1947, which was created to prevent any accidents or issues regarding eating and drinking, as well as improve
public hygiene in Japan.
Ever since its establishment, the association has continued its initiatives to cooperate with organizations
throughout Japan, and contribute to the enhancement of food safety and hygiene among private companies. The
association participates in a wide range of purpose-led initiatives for public interest, and provides training regarding
the self-regulation of food safety management, provides assessments and verifications of certain food products,
promotes food sales legal liability insurance, holds seminars and events, issues and promotes food hygiene related
books and reports, provides informative guidance to consumers, participated in international cooperation regarding
food hygiene, and promotion of relevant research.
Based on advice received from the Japan Food Hygiene Association, the ITOCHU Group is taking necessary
measures to continuously improve its food safety management system by identifying ways to improve food hygiene
and our self-management system.

Japan Plant Quarantine Association (Japanese only) (https://www.zenshoku-kyo.or.jp)
The Japan Plant Quarantine Association was founded on October 1st, 1986, with approval from the Minister ofAgriculture, Forestry and Fisheries, aiming to comprehensively pursue public interests regarding plant quarantines.
The Association engages in a variety of initiatives to enhance the safety of Japan's agricultural production andconserve its natural resources For example, the Association conducts promotional activities to disseminate
knowledge on plant quarantines to the general public, engages in research regarding plant quarantines, facilitates
the establishment of inspection systems, and other various activities to enhance the smoothness of plantquarantine processes.
The ITOCHU Group, collects information on appropriate advertising and labeling methods that address foodallergies and food additives from the Association for the Safety of Imported Food of Japan. This information isreflected in improvements made to our food label registration management rules, label verification methods, thequality of our inspection management, and trainings for qualified food labelers.

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Quality Management in Our Pharmaceutical BusinessPharmaceutical undertakings require sector-specific expertise and is therefore primarily handled by designatedgroup companies. We implement quality control to ensure quality in accordance with the Act on Securing Quality,
Efficacy and Safety of Products Including Pharmaceuticals and Medical Devices. This includes, for example,
assessing and confirming the quality of imported materials at our lab before it is sold.

Assessing Management Capabilities at Our Pharmaceuticals-related
Suppliers and Contributing to Improved QOL
Regular Site Visits for Foreign Suppliers
Not only do we implement quality control at our lab but we also visit our overseas suppliers regularly and perform
inspections to make sure that the manufacturing process conforms to the Pharmaceuticals and Medical. Devices
Act.

Contribution to Improving QOL in the Pharmaceutical Field
We contribute to controlling the rise of medical costs by providing a stable supply of raw materials for genericdrugs. We will also invest in companies that develop regenerative medicines and new drugs to alleviate the sideeffects of cancer and work to raise the level of future treatments and improve patient quality of life.

Initiatives
Initiatives to Support Socially Vulnerable Groups
FamilyMart
At FamilyMart, one of ITOCHU's subsidiaries in the Food Company, we engage in food retailing that first andforemost values the local community's needs. This means that we highly value the contributions we can make tosocially vulnerable groups, and implement measures to address this issue throughout the FamilyMart business suchas in the following ways.

Responsible Advertising, Marketing, and Promotion of Alcohol
At FamilyMart, we are promoting initiatives to prevent sales of alcohol and tobacco products to minors. In July
2017, we upgraded our register system to trigger an audio guidance after scanning alcoholic and tobacco-related
products, which requires both the clerk and the customer to recognize a mandatory warning. This has allowed for
us to improve upon maintaining and increasing awareness of the issue among our store staff, as well as facilitating
the communication between store staff and customers to identify ages.
It is also mandatory at FamilyMart to train new staff members on age identification prior to selling any products inthe store. Additionally, we conduct biennial trainings for all staffs throughout all FamilyMart stores on the selling of
alcohol and tobacco-related products.
Furthermore, in order to ensure that our employees comply with these standards, in addition to tracking training
records on a staff-by-staff basis, we also require store managers and supervisors to conduct checks on criticalelements such as the installation of appropriate labels and signs above what is legally required, the appropriate
division of products, and posters that we require be put up to clearly communicate that we conduct age
identification and strictly prohibit sales of alcohol and tobacco-related products to minors.

Reducing Negative Impact of Food Products
In an increasingly ageing society, the demand for medical budgets and caregivers is rapidly increasing, becoming
pervasive social issues in Japan. In light of this social issue, FamilyMart proactively sells products and services
aimed at supporting the health of its customers, and has combined part of its business with drugstores. These
initiatives aim to support the enhancement of healthy diets among customers, increase a self-care mindset amongcommunity members, and reduce medical expenditures.
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Examples of Health-supporting Products and Services
Selling Medical Foods: Medical Foods are products that specifically limit its containment of salt, sugar, andprotein, which aims to meet the dietary requirements of people with acute diabetes and liver diseases who aresubject to dietary restrictions and home care. FamilyMart provides these products in cooperation with local
hospitals and relevant medical institutions.
Selling products certified by nutritionists and the Smart Meal Certification: With thorough consultation withcertified nutritionists, we have produced products that cater to nutrition needs, which limit calorie and salt, andincrease nutrition balance. One of our lunch boxes sold on a reservation basis, known as the Aburi-Salmon
Bento became the first convenience store produced food product to be certified as a Smart Meal*, meaning thatthe lunch box was recognized for having a particularly balanced nutrition.
Sales strategy that balanced an "on-and-off concept": We sell a variety of food products that as a collective, aim
to increase intake of nutrition, such as products that focus on vegetable, lactic acid bacteria, and dietary fibers,
and at the same time decrease intake of salt and sugar without compromising on flavor.
* This certification scheme is managed by the Healthy Food and Food Environment Consortium, which iscomposed of 10 academic organizations that specialize in health-related issues such as high blood pressure anddiabetes.

Food Safety and Reliability
At FamilyMart, we aim to provide ready-made meals such as rice-balls, sushi, lunch boxes, deli dishes, salad, andsandwiches that ensure safety and reliability for our customers. In order to achieve this, we have voluntarily
enhanced our safety and quality requirements to build upon what is legally required. Throughout each and every
process of production, from procurement of raw materials and manufacturing to the logistics and sales of products,
we make it mandatory to follow these strict requirements, and have implemented support systems to ensure that
this can be sustained. We also especially value the continuous improvement of hygiene management among
contracted manufacturing factories for our ready-made meals, and are implemented measures accordingly.
Moreover, we are also invested in reducing additives in our food products, and aim to ensure that the safety andreliability of our products is at a high level.
Process

Initiative

Procurementof raw

Mandatory food plant inspection (50 items are comprehensively examined)
Assessment and approval of raw materials (identification of necessary quality certifications)materials

Responsible labeling of fast-food ingredients (including raw materials and country of production)

Manufacturing

Promoting HACCP implementation among contracted manufacturing factories for our readymade meals
Training provision to our suppliers and contractors through the Nationwide Quality
Management Conference
Quality audits conducted by third parties
Inspections conducted by FamilyMart plant managers
Reducing the inclusion of additives in our products

Logistics
and sales

Ensuring a sales environment that addresses three fundamental requirements: hygiene
management, expiration date management, and temperature management
Training for stores based on a hygiene toolCommunity Engagement for a Brighter Future
As a member of the Japan Franchise Association, FamilyMart has been promoting the Safety Station Activity, an
activity to help protect the safety of local communities, since 2000. This activity was launched by the National
Police Agency, where initiatives, such as anti-crime measures, disaster prevention, safety measures, thoroughprohibition against the sale of cigarettes and alcohol to people underage to urge those people to go home at latenight, are actively promoted in collaboration with the government, municipalities, and community people. As partof our Safety Station activities, we also provide protection to vulnerable groups such as children, women, andelderly in case of emergencies, and provide guidance and support for youths to build an inclusive community.
Furthermore, at our stores we also set up donation boxes as part of an initiative to contribute to the protection anddevelopment of future generations, as well as preserving the natural environment for these future generations.
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ITOCHU Sugar (Japanese only) (https://www.itochu-sugar.com/)
At ITOCHU Sugar, an ITOCHU group subsidiary, we produce and sell a trademark oligosaccharide product madefrom domestically procured sugar beets, which contain only about half the amount of calories in normal sugar. This
product is effective in maintaining a healthy intestinal environment by enhancing the performance of Bifidobacteria.
The health and nutrition benefits of this product have been widely recognized, with the Ministry of Health, Labourand Welfare certifying it as a Food for Specified Health Uses (FOSHU). FOSHU is a certification system thatrecognizes foods containing ingredient with functions for health and officially approved to claim its physiologicaleffects on the human body.
* Reference︓FOSHU（Food for Specified Health Uses）(https://www.mhlw.go.jp/english/topics/foodsafety/fhc/02.html)

Initiatives to Ensure Responsible Labeling
The Food Company operates a food label registration management guideline, which provides a detailed framework
for us to responsibly label our food products. To ensure compliance to the guidelines, we also provide training tostaff that belong to relevant sales divisions and the Food Safety and Compliance Team. The training aims toenhance our staff's understanding of the food label registration management guidelines and their capability to
conduct inspections and checks on appropriate food labeling. Given increasing importance for this issue and theincreasing size of our food business, we are also aiming to leverage this training to increase the number of foodlabeling practitioners certified by the Food Labeling Certification Association, a Japanese industry organization. In
this way, we maintain the necessary internal capacity to cooperate with specialized third party organizations toensure compliance to our guidelines as well as legal requirements.
At FamilyMart, the responsible labeling of processed foods is especially important as our customers widely vary. For
example, we recognize that we must ensure the safety of anyone with food allergies, and prevent the excessive
intake of certain substances that can have heavy health consequences. Therefore for products sold at FamilyMart,in addition to the 7 items that are legally required in food labelling, we also make sure to label on the optional 20
items to maximize the safety and reliability of our products. We also set internal requirements on the labeling of
information that can help consumers to better understand the food they purchase. Items we additionally require tolabel include raw ingredients, nutritional substances, and how to preserve the product.
With regard to processed food and alcohol, we especially make sure that responsible labeling is thoroughly
addressed. For example, we have implemented measures to simplify and clarify the warnings related to alcohol
poisoning, alcoholism, and underage drinking.

Involvement in Industry Initiatives to Ensure the Safety of Alcohol
Consumption
It is important to our business that we thoroughly address issues regarding the potential negative impacts ofalcoholic products such as alcoholism, alcohol poisoning, and underage drinking. We also recognize that thesenegative impacts are also especially important with regard to vulnerable groups. Therefore, our subsidiaries thatsell alcoholic products are members to industry organizations introduced below, in order to participate inknowledge sharing and be in tune with the latest market trends and best practices.

Gyoshuren Cooperative (Japanese only) (http://gyoushuren.com/about/)
The Gyroshuren Cooperative is an organization composed of trading companies that represent regions throughout
Japan, which engage in alcoholic wholesale. Currently the cooperative consists of about 200 major wholesalers
from throughout Japan.
ITOCHU SHOKUHIN CO., Ltd., an ITOCHU subsidiary, is a member to this cooperative.

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GovernanceTokyo Alcohol Retail Cooperative (Japanese only) (http://tosyukyo.or.jp/)
Tokyo Alcohol Retail Cooperative is an organization with corporate members that participate in the alcohol
business, aims to elevate the level of social responsibility associated to acquiring an alcohol permit. For example,
the organization promotes legal compliance, engages in awareness raising of the negative social impacts that must
be managed across various product types, leads initiatives to maintain cultural traditions around alcohol, leads
initiatives to enhance the current culture around appropriate amounts of alcohol consumption, and supports
companies in achieving sustainable business models. Throughout these activities, the Tokyo Alcohol Retail
Cooperative contributes to the health and wellbeing of the Japanese population, and promotes market competition
that is fair and complies with high standards. The Cooperative highly values harmonious cooperation among
member companies, and has supported the sustained management of businesses throughout the industry and has
subsequently led the development of the industry in general.
Nippon Access, Inc., an ITOCHU subsidiary, is a member to this cooperative.

Contributive Initiatives to Alleviate Hunger and Poverty in Developing
Countries
World Food Programme (WFP)

Given the global level at which we operate our food business, hunger andpoverty are important social issues that we recognize we have a responsibility
to contribute to. One such way that we make our contribution is by being an
official contributor to the Japan Association for the World Food Programme.
As a contributor, we participate in various initiatives led by WFP.
In May 2019, we supported WFP's child hunger eradication campaign called
ITOCHU Employees Participating in“Walk the World“. The annual global walk aims to raise awareness and funds,
the 2018 Walk the World Eventas well as encourage action to end child hunger. This campaign was held in
Yokohama and Osaka, and 476 and 61 employees from ITOCHU Group as well as ITOCHU subsidiaries volunteered ineach location respectively.

Table for Two

Table for Two is an international NPO that was founded by an affiliate of the World Economic Forum's Young Global
Leaders. The organization aims to right the imbalance between the 1 billion people in the world who suffer fromundernutrition, and the 1 billion people in the world who suffer from obesity. The organization does so byimplementing a "calorie transfer" program, where the organization partners with companies, universities,
restaurants, and organizations throughout the world to provide more nutritious school meals to the former, andhealthier meals to the latter.
Table for Two was founded in Japan in October 2007. Owing to ITOCHU's long –standing commitment to social
contribution, we were one of the first companies in Japan to partner with Table for Two and implement the calorie
transfer program in our employee cafeteria at the Tokyo, Osaka, and Nagoya offices the following April.
More specifically, whenever one of our employees chooses a healthier TFT meal from our cafeteria menu, 20JPY is
donated per meal. In addition, through a matching gift scheme, the company also donates the same amount ofmoney as the employee, making the total donation 40JPY per meal. The donation contributes to providing
nutritious school meals to children in developing countries.

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Sustainability in the Value Chain: Action Plan
Risks

Opportunities

Decline in credibility that would result from theoccurrence of a problem related to the safety or
health of consumers and service users.

Increase in demand for food safety and security and health improvement.
Establishment of safe, stable supply system for product enabled by theconsideration of human rights and improvement of work environment in
the supply chain.
Winning customer trust or creating new businesses with a stable supply ofenvironmentally friendly resources and materials. And others.

Materiality

SDGs
Targets

Issues toAddress

Business
Area

Commitment

Specific Approach

Performance Indicators

Degree of Progress

Establishing a
supply chain
reflecting
consideration forhuman rights andthe environment

Supply chain
management

We will promote
information-sharing in theoverall Group and establish
a safe, secure supply chain,
thereby helping customers
with risk reduction andcontributing to sustainableeconomic development.

Make Group-wide efforts toreview the social andenvironmental safety of the
supply chain and make
improvements as necessary,
thereby promoting theestablishment of a safe, securecommodity supply system.

FYE 2024: Establish andvisualize the supply chain of
the overall Group, frommaterial procurement to sales,
to ensure a responsible
procurement policy.

We implemented this in 50 companies inSouthwest Asia (e.g., Vietnam andIndonesia) compared to the 80
companies that was our target in FYE
2020. Separately, we conducted a factfinding investigation questionnaire on thestatus of compliance with the Labor
Standards Act and Industrial Safety and
Health Act for foreign technical interntrainees in 211 sewing plants in Japan.

Provision ofcommodities that
help achieve asustainable
lifestyleBrandmarketingbusiness

We will contribute toincreasing the visibility of asustainable lifestyle bytaking advantage of ourstrengths as a marketingcompany.

Raise awareness of an ethical,
sustainable lifestyle throughbrand business, thereby
promoting awareness-raising not
only in the overall industry but
also among consumers.

FYE 2021 : Take initiatives
with new brands. Have asustainable lifestyle
understood and instilled more
widely.

We have not entered into a contract witha new brand. However, we have realizedcases using the fabric of FOOD TEXTILE
that reuses ingredients scheduled to bediscarded as dyes in our main brand of
CONVERSE shoes.

Supplying safe,
secure food

Overall foodrelated
businesses

We will select andconcentrate on suppliers
who are capable ofmanufacturing andsupplying safe, secure foodstably.

Increase the number of persons
with international
certifications/qualifications
related to audit the Food Safety
Management System (FSMS) toenhance the capability of humanresources for selecting suppliers.

Promotion of the appropriate
appointment of the auditors ineach sales division under theguidance of the ITOCHU foodsafety management
organization.

The number of people who have acquired
the assistant auditor increased by one in
FYE 2020. We plan to increase this by
two people in FYE 2021. We expect the
total number of qualified persons over
our entire group to reach nine.

We will develop a
procurement structurecompliant with third-party
body certification andsupplier-specific codes ofconduct.

We will promote procurement
compliant with supplierspecific codes of conduct incoffee bean producing
countries.
We will strengthen thehandling of oil certified by the
RSPO - a third-party
certification organization forpalm oil.
We will support theestablishment of a promotion
and distribution system inJapan for MSPO/ISPO incooperation with domestic
industrial associations. The
aim of this is to encourage theuse of certified oil systems inproducing countries.

Coffee beans: Promotion of
procurement compliant with
supplier-specific codes ofconduct in our bases in
producing areas incooperation with suppliers.
Palm oil: Promotion ofprogress information
disclosure upon also
clarifying the KPI indicators
by publishing our
procurement policy.

We are currently giving guidance toproducers in each producing area
country to meet the certification
standards. The aim of this is to expand
transactions for certified coffee beans(e.g., those of the Rainforest Allianceand C.A.F.E Practice).
We have published our procurement
policy with our started target ofswitching all the palm oil we procure tosustainable palm oil supplied fromsupply chains compliant with
RSPO/MSPO/ISPO by FYE 2026. We arepromoting the construction of
procurement and supply structures inlight of industry trends and thesituation in suppliers.

FYE 2026: Aim to achieve arate of 100% for certified orunder high-level management
materials that we handle.

Wood products & materials: We arecontinuing to encourage and review
suppliers. We established a path toachieving ahead of schedule a rate of
100% for certified or under high-level
management wood products &materials that we handle in FYE 2021.
Pulp and woodchips: We achieved arate of 100% for certified or underhigh-level management materials that
we handle.

We aim to procure raw
materials with traceability andsustainability ensured innatural rubber processing
business.

We are developing a traceability systemusing blockchains. We plan to introduce
this around the second quarter of FYE
2021.

Textile Company
RespecthumanrightsEnsurestableprocurement
and supply

Ensure stableprocurement
and supply

Food Company

Contribute tohealthier andmore enriched
lifestyles

RespecthumanrightsEnsurestableprocurement
and supply

Establishing a
supply chain
reflecting
consideration forhuman rights andthe environment

Provisions
field

General Products & Realty Company

Using sustainable
forest resources

Wood
products &materials
Pulp
Woodchips

We deal in sustainable
forest resources to reducethe impact on theenvironment and preventthe increase of greenhousegases.

Continue to request suppliers
who have yet to obtaincertifications to obtain them.
Conduct sustainability surveys
of suppliers and visit them.

Ensure stableprocurement
and supply

Realization ofsustainable supplyof natural rubber

NaturalRubberWe shall use our best efforts
to establish measures to
identify any suppliers
developing on High
Conservation Value (HCV)
areas, High Carbon Stock(HCS) areas and peatland,in order to avoid procuring
rubber from them.

We will establish a traceability
system to make uncertain raw
material procurement supply
chain tranceparet.

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Sustainability in the Value Chain: Policy and Basic Concept
Supply Chains
ITOCHU also gives consideration to human rights, labor and the environment in our supply chain and business
investments. We do this through sustainability management tailored to each business activity. Through this, wehave built a sustainable value chain. This is leading to an improvement in the competiveness and corporate valueof the ITOCHU Group.

Notifying Suppliers of the Sustainability Action Guidelines for Supply
ChainsWe believe it is important to acquire understanding andcooperation from our suppliers for our procurement policies.
Accordingly, we once again notified approximately 4,000
suppliers engaged in ongoing business of the ITOCHU
Sustainability Action Guidelines for Supply Chains in FYE
2014. We also stipulated that new suppliers must be notifiedof these guidelines in advance when engaging in businesswith us from January 2015. We are promoting on oursustainability policy in this way.

Sustainability Action Guidelines for Supply Chains
ITOCHU adopted the "Sustainability Action Guidelines for Supply Chains" to clarify and communicate thesustainability concerns we expect our suppliers to address. We will take necessary measures to communicate
and cooperate with our suppliers to ensure responsible management of the following items:
1. Suppliers shall respect the human rights of all of its employees and shall not engage in inhumane
treatments, including discrimination, harassment, abuse and corporal punishment.
2. Suppliers shall not engage in forced labor or child labor and must prohibit the employment of children
under the minimum working age.
3. Suppliers shall not engage in employment discrimination based on characteristics including but not limited
to gender, race, and religion.
4. Suppliers shall comply with statutory minimum wages and aim to exceed living wages. Also, suppliers
shall not conduct unjust wage reductions.
5. Suppliers shall respect the freedom of association and right to collective bargaining of its employees andensure that labor-management discussions on working conditions and environment are held, as appropriate.
6. Suppliers shall comply with statutory working hour restrictions. Suppliers shall also appropriately manage
its employees' working hours and provide holidays and paid leaves as necessary. Finally, suppliers shallstrictly prohibit excessive overtime work.
7. Suppliers shall take necessary measures to provide a safe, hygienic and healthy working environment to
its employees.
8. With regards to its business activities, suppliers shall consider potential and existing impacts on local
communities and the environment – such as impacts on nearby biodiverse habitats or pollution of thelocal ecosystem. Suppliers shall also take necessary measures to reduce its consumption of energy, waterand other natural resources, as well as its emissions of greenhouse gases and waste.
9. Suppliers shall comply with all applicable local and international laws and regulations. Suppliers shall also
ensure its compliance to fair business practices and anti-corruption.
10. Suppliers shall disclose information on all items listed above in a timely and appropriate manner.

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Sustainability in the Value Chain: Structures and Systems
Supply Chain
Against a backdrop of an expansion in our business areas, ITOCHU's supply chain has become wider and more
complex. There is now a further need for risk management concerning human rights, labor and the environment in
the procurement of raw materials, producing areas, intermediate distribution and regions of consumption in
addition to in the processes directly managed by us. We pay particular attention to the on-site management of
suppliers who account for a relatively high share of our purchases. We view our consideration and sense of
responsibility for these areas as matters of great importance to be addressed with high priority.
ITOCHU has established the Sustainability Action Guidelines for Supply Chains. We strive to prevent the occurrenceof problems by conducting investigations and reviews as below. If we discover a problem, we aim for improvement
through dialogue with the concerned supplier.

Figure of Supply Chain Management Promotion

Sustainability Surveys
Since FYE 2009, we have set the seven core subjects of ISO26000 as essential survey items to understand theactual conditions of suppliers. Following on from that, each company and applicable group company selects
important suppliers based on certain guidelines (e.g., high risk countries, products handled and monetary value
handled). The sales representatives of those companies and representatives from overseas subsidiaries andoperating companies then visit those suppliers to conduct interviews. They also conduct sustainability surveys in aquestionnaire format (sustainability checklist).

Sustainability Checklist
The Sustainability Checklist is used to conduct supplier surveys on their managementof relevant sustainability risks. The Checklist is based on the seven ISO26000 core
topics (organizational governance, human rights, labor practices, environment, fairbusiness practices, consumer issues, community involvement and development) and is
supplemented by department and product specific issues that we identified as relevant
to our business and by extension our suppliers (see table below for our list of
supplementary topics. Furthermore, based on opinions provided by external subject
matter experts, we have constructed the survey questionnaire to consist of 19 core
items centered around human rights and labor and environmental topics particularly
associated to high sustainability risks – these items are our priority in supplierengagements.

Supply Chain
Communication
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Outline of Sustainability Survey
High risk countries
Over a certain amount of money

Applicable Survey Criteria

Handling of certain product groups
1. Organizational governance: Establishment of a responsibility-taking structure
and internal report system
2. Human rights: Risk assessments of human rights violations in business,abolition of child labor, forced labor, harassment and discrimination, andpayment of appropriate wages
3. Labor practices: Working hour management, health and safety management,
Main Questions Common
to All Companies

and worker health
4. Environment: Waste and drainage treatment, handling of hazardous
substances, and climate change and biodiversity initiatives
5. Fair operating practices: Prevention of corruption, information management,
prevention of intellectual property right infringements and a sustainableprocurement policy
6. Consumer issues: Quality control and traceability
7. Community involvement and development: Dialogue with consumers andneighboring residents

Department and Product Specific Supplementary Sustainability Items
Procured Resource Type
Paper, wood-chips, timber, timber products

Livestock products (meat)
Textile (including raw materials)
Agricultural products (including palm oil)

Seafood

Additional Survey Items
Implementation of forest conservation measures
Third-party certification
Implementation of food safety measures
Management of traceability
Management chemical substanceManagement of traceability
Management of chemical fertilizers and pesticides
Management of traceability
Management of fisheries

We have also prepared a handbook on communication with suppliers. We are using this to inform our employees of
how to communicate with suppliers. At the same time, we have set up a check system that enables those in charge
to understand concretely the management situation in terms of the environment, human rights, labor practices andcorruption prevention in important suppliers to give advice on making improvements. We will continue to conduct
surveys and communicate with suppliers in the future to improve the awareness of our employees and to seek
understanding and implementation from our suppliers.

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Example Excerpt from the Handbook

Forced labor means all labor forced on a person against his or her will. Examples include restrictions onan employee's freedom to leave his or her job until he or she repays a debt to the company or restricting
an employee's freedom to leave his or her worksite under contract. Forced labor may be identified byasking employees what their work shifts are like, whether they have break times and whether they areable to eat meals. It may also be ascertained by observing their facial expressions. In a worst-casescenario, people are deprived of the freedom to live their lives; they have to live in a dormitory on thepremises of the company's factory and are not allowed to go outside those premises. It is also effective
to check whether there are employees who have come to work from areas far away or other countries in
a company. Employers must be prohibited from taking the originals of passports, IDs and work permits
because this can lead to force labor.

Reference
It is necessary to check for forced labor in factories in Japan as well as in emerging nations. In
recent years, Japan's Technical Intern Training Program (TITP) has been criticized by some fromoverseas. Accordingly, please also check whether suppliers in Japan employ anyone from overseas
and whether there are problems in terms of working hours and wages.

FYE 2020 Sustainability Surveys
We conducted surveys on a total of 316 companies, including 72 suppliers of overseas offices and groupcompanies, in FYE 2020. We did not discover any serious problems requiring an immediate response from thoseresults. We have also checked the prompt improvement measures and countermeasures taken by our business
partners on problems raised as concerns at the time of the survey. We will continue to seek understanding for theconcept of ITOCHU from our business partners and to communicate with them in the future.

Number of Suppliers Surveyed

All (Non-tier
1 Suppliers)

TextileMachinery

Company Company

Metals &Energy &Minerals Chemicals
Company Company

General
Food

ICT &

Products Financial

Company & Realty BusinessCompany Company

FYE 2020

316 (72)

50

15

20

39

102

85

5

FYE 2019

343 (101)

49

13

19

39

110

108

5

FYE 2018

333 (98)

46

9

20

45

103

105

5

In addition to the supplier survey based on our Sustainability Checklist as introduced above, our Textile Company
conducted a domestic supplier survey in FYE 2019 on their management of technical intern trainees. For more
information, please refer to Foreign Technical Intern Trainee Survey on Working Environment (P134).
The Sustainability Management Department also visits and surveys important suppliers together with external
experts as necessary.

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Results of Survey for Department and Product Specific Supplementary Sustainability Items
Procured resource type

Number of Suppliers Surveyed FYE 2020

Paper, wood-chips, timber, timber products

64

Livestock products (meat)

19

Textile (including raw materials)

6

Agricultural products (including palm oil)

4

Seafood22

Human Rights Audits in the Poultry Industry in Thailand

Inspection of the CPF Saraburi Factory
We conducted a human rights audit targeting foreign workers in the Saraburi Factory (a chicken meat
processed product factory) of Charoen Pokphand Foods Public Company Limited (CPF) — one of the main
suppliers of the Food Company — accompanied by external auditors.
Recent years have seen an increase in cases where Japanese companies with Thai firms in their supply
chain have been warned by NGO groups about human rights violations of foreign workers in the livestockand fishing industries in Thailand. We checked the factory for human rights risks in our supply chain
through this audit.
This factory (slaughterhouse and food processing site) employs 3,400 Cambodians — equivalent toapproximately 50% of its workers. That makes them an important part of the factory's labor force. We
checked a number of items in this audit. These included the extent of signage in Cambodian in facilities
in the factory, a check of the evacuation routes, the attendance management situation, and the personal
storage situation of passports and work permits. In addition, we also randomly chose some Cambodian
employees actually working there and interviewed them about their actual working conditions.
This audit did not find any violations of the human rights of foreign workers, and reaffirmed there issufficient consideration for human rights and the proac-tive approach CPF takes toward sustainability.
CPF has developed a safe working environment for its foreign workers.

CPF Saraburi Factory

Those from CPF Who
Cooperated with the Audit

All Signs in Cambodian on Fire
Prevention Facilities

Advice Not to Over-stack
Auxiliary Feedstock

Supplier CSR Audit Report: CP Foods, Saraburi(https://www.itochu.co.jp/en/csr/pdf/supplier_csr_audit_report_e.pdf)
151

Interview with a Cambodian
Worker on His Actual Working
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Sustainability at the ITOCHU Group

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GovernanceRegular Visits and Surveys of Food Processing Factories
The Food Company has been regularly visiting and surveying the food processing factories of its overseas suppliers
since FYE 2012 in regards to imported foods under the initiative of the Food Safety and Compliance Management
Office. In FYE 2020, we visited 197 overseas suppliers and deployed preventive measures to ensure safety in foodtransactions. We established a China Food Safety Management Team in Beijing in January 2015. With this, we have
set up a structure to be able to audit our Chinese suppliers. We conducted regular audits and follow-up audits on
45 companies in FYE 2020. Please refer to Responsibilities to Customers (P139-140) to learn about our initiatives indetailResponse to Suppliers in Violation of This Policy
When we have confirmed a case in which there has been a violation of the intent of this policy, we request
corrective action from the applicable supplier. Together with this, we conduct an on-site investigation to give
guidance and improvement support as necessary. We made 27 requests for correction to suppliers with aninadequate response to human rights in our surveys in FYE 2020. We are continuing to make requests in this way
to non-compliant suppliers. If it is judged that correction is difficult even though we have made continuous
requests for correction, we deal with this under a stance of reviewing our business with that supplier.

Business Investment Management
The business activities of companies in which we invest must recognize and deal with their possible impact on theenvironment and society. To that end, we strive to understand ESG risks and work on preventative activities. We
perform risk assessments on ESG in general through the utilization of a checklist and visits and surveys toformulate the necessary measures. These are continuously reviewed and improved in the framework of ourenvironmental management system.

ESG Risk Assessment for New Business Investment Projects
It is compulsory in new business investment projects for the division making the application to use the ESG
Checklist for Investments to evaluate the project in advance (perform due diligence). The division making theapplication looks at whether policies and structures have been established from a perspective of ESG. It also looks
for the risk of a significant adverse effect on the environment, violation of laws and ordinances, and complaints
from stakeholders. This checklist consists of 33 check items. These include elements of the seven core subjects* in
ISO26000 — the CSR international guidelines.
The division making the application also then refers to review opinions based on risk analysis from relevant
functional divisions (management divisions). If there are any concerns, it requests additional due diligence fromexternal specialist organizations for matters requiring a professional point of view. The project is then only
undertaken upon confirming that there are no problems in those results.
* Organizational governance, human rights, labor practices, the environment, fair operating practices, consumer
issues, and community involvement and development

Group Company Fact-finding Investigations
We have continued to conduct on-site visits and surveys in group companies since 2001 to prevent environmental
pollution. We visited and surveyed a total of two companies in FYE 2020. We did this together with external experts
upon consideration for the environmental and social risks of each company. We have completed investigations into
a total of 285 offices as of the end of March 2019.
These investigations inspect the factory and warehouse facilities, the situation of drainage to rivers, theenvironmental law and regulation compliance situation, labor safety and human rights, and communication withthe local community in addition to holding a question and answer session with management. We identify problems
or demonstrate preventative measures. We then check to see whether the situation has been corrected.

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Visit and Survey Report: DOLE PHILIPPINES Fact-finding Investigation

We visited and surveyed DOLE PHILIPPINES, a company which produces
banana, pineapple and other fresh fruits and manufactures fruit cans in thePhilippines, on January 20 to 23, 2020. We performed a detailed checkconcerning the environment and labor safety related risk management andlegal compliance situation (e.g., soil pollution, waste, chemical substancemanagement and safety measures) based on the findings of external experts
well-versed in the local laws and regulations. We confirmed that thesematters are being appropriately managed. In addition, we confirmed that thecompany is proactively working on activities that contribute to society andthe environment (e.g., biomass power generation on its premises anddonations to local schools).

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Sustainability in the Value Chain: Sustainable
Procurement: Policies and Initiatives by Product Type
Resource Sourcing that Requires Forest Conservation Initiatives
ITOCHU handles each of the following commodities, which require careful consideration of forest conservation
initiatives. In addition to the Sustainability Action Guidelines for Supply Chains, the following Procurement Policy
establishes our approach to protecting and preserving natural forests our commitment to the sustainable use ofnatural resources. At minimum the Policy is subject to an annual review, with revisions made as necessary.
Commodities Relevant to Forest Conservation
Timber, timber products, raw materials for papermaking and paper products
Natural rubber
Palm oil

Policy and Management Approach to the Preservation of Natural
Forests and the Sustainable Sourcing of Forest Resources
Sustainable Procurement Policy on Natural Forests and Forest Resources
Organizational Scope
ITOCHU Corporation and its group subsidiaries

Sustainable Procurement Policy on Natural Forests and Forest Resources
1. We shall aim to make improvements in the transparency and traceability of our supply chain in order to ensurethat we can take necessary measures to prevent sourcing activities that can contribute to deforestation.
2. We support the conservation and preservation of High Conservation Value (HCV) areas, High Carbon Stock(HCS) areas, and peat areas. Additionally, we are committed to respecting the Community and Social
Considerations (free, prior and informed consent – FPIC), and will continually strive to reduce our impact on theenvironment.
3. We will not procure from suppliers involved in major environmental and social issues, such as deforestation ofareas with high conservation value.
4. We support the standardization of a reliable forest certification systems and will proactively seek opportunities
to prioritize certified products when procuring timber, timber products, raw materials for papermaking, andpaper products.
5. Regarding natural rubber, raw materials for papermaking, and paper products, which requires extensive wateruse, at minimum we commit to complying with all applicable wastewater laws and regulations. We will also
commit to properly treating wastewater to exceed legal requirements where possible and strive to reduce total
water consumption by recycling water resources where possible.
6. In carrying out palm oil-related projects, we will strive to procure from suppliers taking necessary measures tominimize and eliminate chemical substance use, especially those related to paraquat, 1A/1B class insecticides as
defined by the World Health Organization (WHO), and chemicals listed in the Stockholm Convention and theRotterdam Convention.

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GovernanceItems related to forest conservation and the corresponding "Sustainable procurement policy on natural forests andforest resources" are as follows.
Items Related to Forest Conservation
Items under the Policy

Timber, Timber
Products

1. Zero deforestation andtraceability

Raw Materials forPapermaking andPaper Products

NaturalRubberPalm Oil

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

2. Protection and preservation of
production areas andconsideration for local residents
3. Elimination of suppliers
involved in major environmental
and social issues
4. Standardization of forest
certification systems
5. Consideration for wastewater〇

and water resources〇

6. Minimization or non-use of〇chemical substances

In cooperation with our Group companies and suppliers, we will engage in sustainable procurement of forestry
resources based on the Sustainability Action Guidelines for Supply Chains and this Policy, especially by taking
necessary measures to ensure the traceability of procured items.
In order to promote this Policy, each company and corresponding Group companies are required to conduct asustainability survey on critical suppliers. If any non-compliance with this Policy is identified, we will conduct
supplier engagements to resolve the issue and request measures for improvement. If timely improvements are notmade by suppliers, we will re-consider any business agreements with them.
As for the survey results obtained through the supplier survey, we will regularly disclose information to ourstakeholders. We will also promote sustainable use of forest resources to the wider society through appropriate
communication with stakeholders, particularly our suppliers and customers.

Management Approach
Every year, we report and receive approval on our targets and progress made to senior management. We also
share suggestions from stakeholders including NGOs, and if any issue is identified, we review our measures andthis Policy, as necessary.
Regarding palm oil, procurement based on this Policy is carried out by the Oil, Fats & Cacao Department of theFood Division within the Food Company – this department is therefore also responsible for the compliant
procurement of palm oil.
Regarding timber, timber products, raw materials for papermaking and paper products, our Group ESG
Managerprovide training to members who handle these products at least once a year. The training aims to educate
them on domestic and international trends and issues related to forest resource development and sustainable
forest resource utilization.

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Wood, Wood Products, Papermaking Raw Material, and Paper Products
ITOCHU is engaged in the procurement, manufacturing, and distribution of materials for pulp and paper products,
wood and wood products, and woodchips. In order to ensure the protection of natural forests and sustainable useof forest resources, we aim for 100% use of certified material or material for which advanced management can beverified until 2025.

Celulose Nipo-Brasileira S.A.
ITOCHU invested in Celulose Nipo-Brasileira, the world's eighth largest
manufacturer of commercial hardwood pulp, together with a major
Japanese pulp manufacturer and others and sells 1.2 million tons of thecompany's pulp produced 100% from plantation trees as a worldwide
export distributor. Celulose Nipo-Brasileira has obtained Forest
Management certification and CoC certification (a certification for
management of the processing and distribution processes) from theForest Stewardship Council (FSC) and handles everything up to pulp
manufacturing through sustainable plantation-based forest
management. The company plants trees on roughly 130,000ha out of
the approximately 250,000ha (about the size of Kanagawa Prefecture)
Vast Plantation of Celulose Nipoof land it owns to produce pulp. The remaining roughly 100,000ha is
Brasileira
left as permanently protected forest or legally protected forest, andthey are working to maintain the ecosystem.
They also plant 70,000 saplings of four kinds of trees found in natural forests in the region annually for the purposeof regenerating forests in areas where there have been soil disruptions, landslides or withering of vegetation. Thesetree planting activities take place on 300ha of land per year. At Macedonia Farm, a natural forest preserve, thecompany engages in activities to protect endangered birds and ensure that they reproduce, protecting, breeding,and releasing rare wild birds like the "mutum" (a pheasant-like bird).

Metsä Fibre
ITOCHU has a stake in Metsä Fibre, a world-class softwood pulp
manufacturer based out of Finland. Metsä Fibre boasts an annual pulp
production capacity of around 3.2 million tons (including the Äänekoski
Plant, which was expanded in August 2017 and has begun new
operations). They have tapped ITOCHU as the exclusive distributor for
their softwood pulp destined for Asian markets. The company
manufactures pulp from 100% traceable forest resources of which 80%
have received two certifications, namely the Forest Stewardship Council(FSC) and the Program for the Endorsement of Forest Certification
Schemes (PEFC).
In Finland, pulpwood growth exceeds consumption, which allows for aNew Äänekoski Plant commissioned inlong-term, stable supply of pulpwood. Additionally, Metsä Fibre
2017
generates electricity in the pulp manufacturing process. What is not
used in-house is supplied to neighboring communities, contributing to a reduction of fossil fuel consumption in thearea. Through initiatives carried out with excellent partners such as this, we will promote the use of sustainable
forest resources and continue to promote further strengthening of our business.

Certification of Traceability for Chinese Timber
Since 2013, ITOCHU KENZAI has been working to create a system for certifying the traceability of plywood
manufactured in China. In 2017, we were audited by Japan Gas Appliances Inspection Association (JIA), a
certification body, and we received certification of timber traceability in our main supply chain. The Timber
Traceability Certificate ensures traceability and that timber is managed throughout all processes within the supply
chain, from the logging areas to the veneer and plywood factories, by obtaining logging permits and otherevidence, auditing factories, observing the logging areas, and other means. With this, ITOCHU KENZAI was able toreliably ensure that no timber from illegal logging is used in around 40% of the plywood manufactured in China forwhich forest certification has not been obtained.
Timber Traceability Certificate (https://www.itochu.co.jp/ja/csr/pdf/wood_traceability_certification_2019.pdf)
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Sustainability Survey and Supplier Engagement
Every year, we conduct a survey of our suppliers and those of our main business companies in relation to our
products. We include suppliers that have been deemed low risk according to the guidelines so that we can engage
in continuous dialog with a broader scope of suppliers.
In addition to the sustainability survey, we work to ascertain the situation through on-site inspections and due
diligence at those suppliers that have received suggestions from non-governmental organizations and actively urge
them to obtain forest certification or certification by a third party agency.

Sarawak, Malaysia
A non-governmental organization has pointed out problems with illegal
logging and human rights in Sarawak, Malaysia. Every year, we work toascertain the situation through interview surveys of our supplier, thelocal government, a timber association, human rights lawyers with thehuman rights committee, local residents, local non-governmentalorganizations, forest consultants, and others.
We have not found the problems pointed out by the non-governmentalorganization through these surveys, but to eliminate concern, we haverepeatedly requested that the supplier engage in specific initiatives. As
a result, in recent years, the supplier has actively worked to obtain
Interview with Indigenous Community
forest certification, and the number of certified forest areas has
in Anap Muput Forest Management
increased. Changes have also occurred in the local government in Sarawak, including reinforcement of regulations
to eliminate illegal logging and announcement of measures to promote forest certification.

Romanian Supplier (Schweighofer)
Romanian supplier Schweighofer is one of ITOCHU KENZAI's lumber
suppliers and was alleged by a non-governmental organization to beengaged in illegal logging. ITOCHU KENZAI called on the supplier tomake efforts to eliminate the concern and referred to advice given by
the non-governmental organization to select sites to visit. Every year,
ITOCHU KENZAI conducts interview surveys with various stakeholders,
including local government agencies, industry groups, forest
certification organizations, and local non-governmental organizations,to ascertain the situation.
Schweighofer possesses PEFC certification and conducts risk
Interview with Romania Water andassessments of its supply chain to make sure that no lumber from
Forest Ministry
illegal logging finds its way into the supply chain. In 2016 Indufor, an international forestry consulting firm,
certified the effectiveness of this risk assessment. In 2017, the company introduced a timber traceability systemcalled "Timflow" that ensures traceability from all of its timber collecting points to its sawmills for the purpose ofeliminating any timber produced by illegal logging from its operations. The following year, they announced an
open-door policy to improve communication with non-governmental organizations, allowing representatives frompre-registered non-governmental organizations to visit their sawmills without notice. Through on-site visits,
ITOCHU KENZAI was able to verify that timber produced by illegal logging has been eliminated and that initiatives
to increase transparency have improved year after year.

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Performance Regarding Forest Certification and Legal Compliance
ITOCHU evaluates its performance by classifying its timber and timber products into the following four categories
based on forest certification and legal compliance. Category (A) signifies the highest level of sustainableprocurement compliance, requiring FSC certification and/or PEFC certification – more specifically, it is defined as "(A) Timber handled by a certified forest supplier or timber approved by a certification body".
Classification Based on
Legality

Certifiedmaterials or
advanced

Forestcertification
systemmanagement
can beconfirmed

Certificationof legality
in a clean
timberN/Amethod

Item

FYE
2018

FYE
2019

FYE
2020

(A) Timber handled by a certified forest supplieror timber approved as a management material
by a certification body (acquired FSC or PEFC
certification)

43%

36%

64%

(B) Timber harvested in countries or regions
assessed as "Low Risk" based on the forest
certification system

36%

44%

25%

(C) Timber whose legality has been confirmed bydocuments proving that it was cut in compliancewith the laws of the place of origin*1

18%

17%

10%

(D) Materials whose legality has been confirmed
by "additional measures"*2

3%

3%

0%

*1 Specifically, materials confirmed by an export license, certificate of origin, etc.
*2 Specifically, timber that was confirmed to be in compliance with laws by asking suppliers to provide a
distribution channel

Sustainable Procurement Performance of Raw Materials for Papermaking
All raw materials for papermaking such as chips and pulp handled by ITOCHU have acquired FSC or PEFC
certification as "materials handled by certified forest suppliers or materials approved as management materials bya certification body".
Classification Based on
Legality
Certified materials
or advanced
management canbe confirmed

Forestcertification
system

FYE
2018

FYE
2019

FYE
2020

Chips

100%

100%

100%

Pulp

100%

100%

100%

Item
Timber handled by a certified
forest supplier or timber approved
as a management material by acertification body (acquired FSC or
PEFC certification)

Natural Rubber
ITOCHU is engaged in the business of processing and trading natural rubber. Natural rubber is mainly produced inSoutheast Asian countries such as Thailand and Indonesia, and about 70% of it is used for making tires. While thedemand for natural rubber is projected to continue growing, internationally concerns are being raised on
deforestation and the human rights violations of indigenous people with regard to procurement activities. In its
distribution from raw materials procurers to tire manufacturers, natural rubber passes through the hands of many
intermediary businesses (such as collectors and transporters), making environmental and social impacts difficult tomanage. This is why increasing the traceability and transparency of natural rubber procurement is an increasingly
important issue for ITOCHU.
In response, ITOCHU has joined as a founding member of the Global Platform for Sustainable Natural Rubber(GPSNR), which was established in October 2018. We agree on the 12 principles stipulated by GPSNR andcooperate in the development and operation of the Platform's standards.
Natural Rubber Procurement Policy (https://www.itochu.co.jp/en/csr/pdf/natural_rubber_policy.pdf)
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GovernanceParticipation in the GPSNR
In October 2018, ITOCHU joined the new Global Platform for Sustainable Natural Rubber as the only Japanesetrading company founding member. This organization was established by car manufacturers, tire manufacturers
and natural rubber processing companies involved in the natural rubber industry. Its members work together
throughout their supply chain to establish traceability and achieve higher levels of sustainability.

Initiatives for Demonstration of Traceability Using Blockchain
In February 2019, ITOCHU started a trial of a traceability system using blockchain technology to ensure stableprocurement and supply of resources on the supply chain of business investments and products handled, and toensure transparency in their distribution.
The trial test was conducted based on a system designed by ITOCHU Techno-Solutions Co., Ltd. (Headquarters:
Chiyoda-ku, Tokyo; President: Satoshi Kikuchi; hereinafter "CTC"), which leveraged the natural rubber raw
materials supply chain of PT. Aneka Bumi Pratama (HQ: Indonesial, President: Hisashi Yajima; hereafter "ABP"), a
100% group subsidiary to ITOCHU.

Conceptual Diagram of the Natural Rubber Supply Chain and This Trial Test
The content of transactions in the trial are mutually authenticated between the transferees using a smartphone
application, and recorded on the blockchain together with the date, time, location information, etc. Ensuring thatthese data points are gathered makes the distribution of natural rubber up to the processing plant moretransparent. In order to encourage and incentivize the cooperation of each business, we will prepare a mechanism
allowing to financial compensation for correctly recorded transactions.
ITOCHU aims to achieve sustainable growth through the spirit of "Sampo-yoshi" by working on the progressive
innovation of business, which constitutes a fundamental policy of our medium-term management plan. We also
anticipate that these initiatives will contribute to the achievement of the Sustainable Development Goals (SDGs) of
the United Nations by 2030 by innovating leading sustainable procurement practices.

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Palm Oil
Palm oil has been widely associated to environmental destruction and human rights violations in relation to thedevelopment and production of plantations. ITOCHU is extensively engaged in the trade and distribution of palm oil
but is not involved in the palm plantation business. Therefore, though we recognize the gravity of social andenvironmental implication of palm oil, we are engaging in the issue from our position as a distribution player. For
example, are a member of the Roundtable on Palm Oil (RSPO) and are working to fulfill our corporate social
responsibility by taking responsibility and standing as a bridge between producers and consumers. We are also
cooperating in the spread of certified oil other than RSPO, such as MSPO*1 and ISPO*2, in cooperation withindustry groups.
In addition to having formulated the Sustainable Procurement Policy for Palm Oil, we aim to preserve naturalforests and ensure sustainable consumption of forest resources by promoting transparency in the supply chain andstrengthening the sustainable palm oil procurement system.
*1 Malaysian Sustainable Palm Oil*2 Indonesian Sustainable Palm Oil
Sustainable Procurement Policy for Palm Oil(https://www.itochu.co.jp/en/csr/pdf/sustainable_palm_oil_procurement_policy.pdf)

Establishing Transparency
ITOCHU will inspect its supply chain as a way to fulfil our corporate social responsibility. In doing so, we will
identify issues and strive to solve them with the aim to achieve sustainable procurement and supply of palm oil.
Our goal is to achieve 100% traceability at the mill level by 2021 and to switch all palm oil procured by theCompany to sustainable palm oil*1 by 2025. In particular, we aim to base our procurement on the NDPE principle(No Deforestation, No Peat, No Exploitation)*2.
*1 Sustainable palm oil: palm oil supplied from the supply chain according to RSPO and equivalent standards*2 No Deforestation, No Peat, No Exploitation (NDPE): zero deforestation, zero peatland development, zero
exploitation

Membership to the Roundtable on Sustainable Palm Oil (RSPO)
We joined the Roundtable on Sustainable Palm Oil (RSPO) in 2006, and respect the principles and standards set by
the RSPO (such as the Principles and Criteria for the Production of Palm Oil) to promote transparency in the supply
chain. We are working to strengthen the sustainable palm oil procurement system by expanding transactions with
suppliers of raw material that have improved their traceability.
We confirm priority items and utilize them in procurement through sustainable procurement surveys, including onsite examinations, and direct engagement with suppliers.
In the course of our operations, we regularly review our procurement policy in cooperation with stakeholders suchas business partners and experts. Information regarding this matter will be disclosed through the ESG Report, theSustainability Action Plan, and the Annual Communication of Progress (ACOP).
Sustainability Action Plans (P14-22)
The Annual Communication of Progress (ACOP) (https://www.rspo.org/members/63/itochu-corporation)
Please also refer to the disclosed information below regarding ITOCHU's initiatives.
Initiatives for sustainable procurement of palm oil (as of the end of 2019)(https://www.itochu.co.jp/en/csr/pdf/fact_sheet_2020.pdf)
Refinery list (as of the end of 2019) (https://www.itochu.co.jp/en/csr/pdf/refinery_list_2020.pdf)
Mill list (as of the end of 2019) (https://www.itochu.co.jp/en/csr/pdf/mill_list_2020.pdf)

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Performance Data Regarding Sustainable Palm Oil Procurement
Our goal is to achieve 100% traceability at the mill level by 2021 and to transition all procured palm oil tosustainable palm oil by 2025. The following table shows the current progress information, actual results and target
information.
Performance

TargetCategory
2017

2018

360,000mt

277,000mt

308,000mt

Malaysia

Malaysia

Indonesia
RSPO Members
Suppliers under NDPE policy

Volume of handled palm oil

2019

2021

2025

Malaysia

Malaysia

Malaysia

Indonesia

Indonesia

Indonesia

Indonesia–

9/9 (100%)

10/10 (100%)

100%

100%

–

9/9 (100%)

10/10 (100%)

100%

100%

0.30%

1.10%

9.87%

–

99.80%

99.90%

100%

100%<Main suplier><Certified Sustainable Palm Oil>RSPO certified sustainable palm oil<Traceability>
Traceable to the mills

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Dairy Products, Meat, Marine Products, Fiber Raw Materials
Dairy Products
In terms of the dairy product and supply structure in Japan, the domestic production and supply structure has been
established with a focus on Hokkaido. Meanwhile, import opportunities have steadily been increasing. This is due tothe formation of the TPP that was established at the end of 2018 and the Japan-EU EPA that is scheduled tocommence on February 1, 2019. Currently, Japan imports dairy products from multiple countries and regions –New Zealand, Australia, European countries, North America and South America. The agricultural policies andproduction structures in each country and region have been reflected in initiatives for the sustainable growth
production structure in dairy products. Producer organizations and companies have also started initiatives toward
gradually building a sustainable growth production structure. We are striving to grasp the initiatives of major
producing areas and major suppliers. We will then work to build close communication and relationships with major
suppliers so that it is possible to provide even safer dairy products with greater peace of mind.

Ensuring the Safety of Raw Milk
The most important initiatives in securing the safety of dairy products are those to ensure the safety of raw milk.
The structure for this is as follows. Raw milk is milked from cows and collected by dairy farmers before beingbrought to dairy product factories. Antibiotic contamination tests are then conducted at the acceptance stage. Only
raw milk confirmed to be safe is used.
Cheese and butter is individually wrapped in cardboard boxes of 10 kg or 20 kg. Meanwhile, powdered skim milk
(not including milk powder) is produced in manufacturing factories mainly in 25 kg paper bags. The manufacturing
date is printed on these boxes and bags. This means it is possible to trace products up to their date of productionin their manufacturing factory.
* The standards for hormones and antibiotics used in raising beef and dairy cows are stipulated by the relevantorganizations of each country. Dairy product manufacturers have established voluntary management rules
based on those standards. A check is also performed each time to see whether there are any residual
substances other than raw milk in the transportation vehicles used when bringing it from farmers to factories.

Measures to Ensure the Sustainable Cultivation of LandIn New Zealand, which has an important position as a supply base for Japan, dairy cows are basically raised with afocus on grazing. Initiatives are made on a routine basis from the point of view of improving productivity. For
example, dairy cows are raised while regularly changing their field so that these fields do not become ruined.
The development and distribution of grass-fed* butter and other products has started as a new experiment in New
Zealand and elsewhere.
* Grass-fed refers to beef and dairy cows raised only by eating grass. Regular butter is made using the milk of
cows raised by eating mainly grains. In contrast to this, grass-fed butter is made with the milk of cows raised
only by eating grass or only by eating grass above a certain rate. This has the advantage of being less of an
economic burden compared to raising cows mainly on grains.
The Netherlands is engaged in the overall management of its number of breeding cows as a nation. This is being
done in consideration of the impact the phosphate contained in the excreta of dairy cows has on the soil.

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Meat
The Meat Products Department in the ITOCHU Food Company imports
and procures raw meat ingredients (beef, pork and chicken) fromvarious countries around the world. It handles pork in the greatest
quantities with raw ingredients primarily being procured from North
America and Europe. Meanwhile, it imports beef from Australia and the
U.S. We have jointly invested in Teys Australia Condamine Pty Ltd. in
the cattle fattening business in Australia together with an Australianbeef supplier called Teys and Prima Meat Packers.
The following is our basic policy for performing inter-company initiatives
when procuring raw meat ingredients from overseas: Production
Teys Australia Condamine's Cattle
suppliers who do business with ITOCHU should be aware of
Fattening Farmenvironmental aspects at the production stage. They should take into
consideration the workers involved in production. Finally, above all, they should construct production operations
including traceability that can guarantee safety and peace of mind.
ITOCHU regularly visits factories that are our supply sources. We do this under a commitment to responsible meatprocurement. We establish good relationships through close communication with overseas suppliers.

Ensuring Traceability at HyLife Group Holdings
HyLife is capable of supply chain management and coordination inhouse because it performs integrated production that includes pig
farms, mixed feed factories and pork processing. The company has
utilized this production structure to realize a stable supply of safe, highquality and traceable products with peace of mind. In addition, it ispossible to feedback the individual needs of customers to pig farms
through such integrated production. The firm has established a
specialty program customized for Japan – a program that has received
a high appraisal in the market. Currently, it is the number one company
in Canada in terms of refrigerated pork exports to Japan.

Pork Processing Process

Teys Australia Condamine's Global Warming Countermeasures
Teys Australia Condamine introduced 1,034 solar panels in 2015. Thishas made it possible to generate approximately 506,000 kWh of power
annually. Accordingly, approximately 50% of the power used in thisfacility comes from renewable energy. The introduction of solar power
generation has reduced CO2 emissions by approximately 395 tons.
Consequently, a reduction in CO2 emissions of approximately 49% has
been realized compared with before the introduction of solar power
generation.
We also procure beef to be slaughtered and processed from Teys – ourInstalled Solar Panels
joint investment partner in Australia. This firm has formed sustainable
operations. It extracts methane gas generated in the slaughter process and reuses it as heat for its factory.

Initiative Participation
Companies in wide-ranging lines of businesses – from producers to retailers – are participating in an initiative
called the Global Round Table for Sustainable Beef (GRSB) with the aim of sustainable beef production. ITOCHU has
built business relationships with multiple companies participating in the GRSB. We are exchanging information withthem on the latest trends.

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Performance Data of Traceability
The major premise for ITOCHU is to be able to thoroughly trace the products we deliver to our customers back totheir producers above all else while considering the safety and peace of mind of food as our number one priority.
We have a 100% "traceback" system for all meat (beef, pork, chicken) produced by suppliers (mainly overseas)and handled by ITOCHU allowing us to trace back products up to their production stage.
PerformanceContent
2017
Volume of handled meat (tons)*

About 160,000

2018
About 150,000

2019
About 130,000* Beef, pork and chicken are 100% traceable back to the production stage

Animal Welfare
The ITOCHU Group raises livestock in a comfortable environment to reduce livestock stress and disease. The
following measures have been taken to handle livestock humanely, based on the belief that it will increase
productivity and produce safe livestock products.
Teys Australia is committed to ensuring that all cattle are treated humanely.As part of our commitment to animal
welfare, all Teys Australia processing facilities operate under the Australian Livestock Processing Industry Animal
Welfare Certification System (AAWCS). An independently certified animal welfare program that ensures thatlivestock under our control (from receipt to humane processing) are managed in accordance with best practiceanimal welfare standards.
Teys Australia operates its feedlots in strict compliance with the independently audited National Feedlot
Accreditation Scheme.
Respecting Animals is a HyLife Core Value and the obligation and responsibility of all employees.
HyLife provides optimal environmental conditions for the animals in our care providing climate controlled housing,nutritionally balanced diets and veterinary animal health oversight.
All employees receive comprehensive training in the proper care and handling of animals and farms are operated inaccordance with the Canadian Code of Practice for the Care & Handling of Pigs and are certified under the Canadian
Quality Assurance Program.

Marine Products
We mainly handle skipjack and yellowfin as marine products. In Indonesia, we operate the PT. Aneka Tuna
Indonesia (ATI) canned tuna factory in a joint venture with partners. We have established voluntary management
regulations for tuna. We thoroughly stick to our policy of only procuring skipjack and yellowfin that has been
appropriately managed by fishing organizations.

Targets
The acquisition of MSC*1 certification is limited among fishermen for the highly migratory fish of skipjack andyellowfin at present. Under these circumstances, we handle 4,500 tons of MSC raw ingredients per year at present
in the trade of skipjack and yellowfin for canned raw material. We are also aiming to encourage fishermen toacquire MSC so that we handle 10,000 tons per year within five years.
The rate of pole and line fished*2 products in our canned tuna handling was 7% in FYE 2014. However, this rate
exceeded 14% in FYE 2019. We would like to continue maintaining and expanding this rate with the aim ofreaching 20%.
The usage rate and quantity of pole and line fished raw material in ATI more than doubled from 20% at 8,000 tons
in 2013 to 40% at 20,000 tons in 2018. It has become one of the few canned tuna factories in the world that uses
pole and line fished raw material. We will continue striving to secure, maintain and expand pole and line fished raw
material.
*1 The Marine Stewardship Council (MSC) is an international NPO established in 1997 to work on spreading
sustainable fishing. Its headquarters are located in London, England.
*2 Pole and line fishing is a method of fishing by catching one fish at a time. It is a sustainable fishing methodthat does not involve the catch of large quantities of fish at one time. It is said that it is an environmentallyfriendly fishing method because it is also possible to avoid the bycatch of non-targeted fish.
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Sustainability Surveys for Marine Resource Suppliers to Ensure Responsible
Procurement Practices
We regularly visit and survey our suppliers. This is so that we responsibly procure marine resources for all themarine products we handle. We also promote cooperation with various fishing organizations. Every year, those incharge of sales visit and survey 45 suppliers applicable to our internal selection criteria in cooperation with ourFood Safety and Compliance Management Office. This is for the regular visits and surveys on our suppliers to
responsibly procure marine resources. We also engage in business after confirming that suppliers are appropriate
from a viewpoint of ESG.
Regarding bonito tuna, which we handle in vast quantities, in September 2017 we established a voluntary
management rule called "Tuna Handling Management Rules", which prohibits procurement from IUU fishing(concerning illegal fishing: "Illegal, Unreported and Unregulated"). We only procure and purchase marine products
whose origin is clearly traceable to fisheries that are properly managed by the Western & Central Pacific FisheriesCommission (WCPFC).

Certifications and External Stakeholder and Initiative Participation
We acquired distributor certification and chain of custody certificate(CoC)*1 certification from the Marine Stewardship Council (MSC) in
March 2018.
We joined the Organization for the Promotion of Responsible Tuna
Fisheries (OPRT) in 2012 in the tuna business. This is an organizationthat was established for the sustainable use of tuna resources. We are
now promoting initiatives that comply with our aforementioned
voluntary management regulations.
ATI is strengthening its handling of pole and line fished raw material–considered to be the most environmentally friendly skipjack andPole and Line Fishingyellowfin fishing method. The need for products made with pole and line
fished raw material is growing every year in markets with a high interest in sustainability (e.g., the U.K. andAustralia) for the canned tuna market as well. It is our policy to strengthen our handling of pole and line fishedproducts manufactured by ATI.
ATI joined the Indonesian Association of Pole & Line and Hand Line in 2014. It is offering its cooperation such as byproviding data. This data is used in the Fishery Improvement Program (FIP)*2. ATI is also cooperating for theacquisition of MSC in Indonesia. Moreover, it joined an international organization called the International Seafood
Sustainability Foundation (ISSF)*3 in 2016. The firm is offering its cooperation such as by providing information in
the same way as it does with the Indonesian Association of Pole & Line and Hand Line.
*1 Chain of custody certificate (CoC) is certification for processors and distributors. This is to ensure thetraceability of MSC certified marine products and other products in the management of processing anddistribution processes specified by MSC.
*2 The Fishery Improvement Program (FIP) is a project in which small fishermen finding it difficult to acquire MSC
certification and market stakeholders cooperate and work together aiming for sustainable fishing under thegoal of future MSC acquisition with MSC compliant fishing methods.
*3 The International Seafood Sustainability Foundation (ISSF) is an organization running under the aim ofsustainable skipjack and yellowfin fishing. It was launched in response to an appeal by major canned tunaoperators in 2009.

Performance Data Related to Certification
FYE 2014
Results

Item

Bonito tuna forcanned tunaObtained MSC
and/or COC
certification

FYE 2020
Results

Target(Next 5 Years)

MSC, COC quantity

N/A

7,300 tons

10,000 tons

MSC, COC%

0%

4%

5%

8,000 tons

25,000 tons

25,000 tons

7%

17%

20%

ATI Single Fishing Raw Material Quantity
ATI fishing line
Single fishing tuna product ratio

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Sustainability at the ITOCHU Group

Society

Environment

GovernanceTextile Raw Materials
In recent years, the trend for sustainability has been gradually penetrating the fashion market. For example, global
fashion brands have declared that they will switch to using environmentally friendly materials (e.g., organic cotton,
recycled polyester etc.) for the materials they procure as an initiative to develop the labor environment in the
supply chain and to deal with the disposal of clothing and other problems. This issue is particularly important to us
given that ITOCHU was founded as a textile raw materials trading business, which remains a cornerstone of ourcompany to this day as a part of the Fashion Apparel Division. Therefore, in our textile business we have made it
our policy to shift our raw materials portfolio to environmentally friendly resources and build traceability capacityfrom raw materials procurement to distribution to manufacturers. Our target for this policy will be to make 50% of
the textile raw materials that we handle traceable and environmentally friendly by 2025.

Organic Cotton Procurement in India
Traceability in Organic Cotton Procurement in India

Traceability in the Recycled Polyester Business Utilizing the Technologies of JEPLAN

When we procure organic cotton in India, we first purchase raw organic cotton that comes with a certificate from aginning (work to separate the seeds and fibers after harvesting raw cotton) factory in India that has acquired GOTS
certification. We deliver that raw organic cotton to spinning factories that have acquired GOTS certification in India
or Asia. Finally, we purchase the yarn spun in those spinning factories and sell it to weaving/knitting factories inJapan and overseas. Furthermore, with regards to the traceability of organic cotton, we have implemented
measures to leveraging our vast network and experiences to facilitate our cotton farmers in India to shift toward
organic farming methods and to support certification acquirements (such as the GOTS certification*) at our cotton
mills and ginning factories. Given these initiatives, we have achieved 100% traceability in the organic cotton that
we handle among the cotton we have procured during the 3 year transition period.
Leveraging this experience, the "RENU" project started full-scale operation in 2019 and has quickly acquired GRS(Global Recycle Standard) certification for recycled polyester yarn.
* GOTS certification: a set of comprehensive standards that certifies products made from organic textile. The
standards cover the following items: use of certified raw materials and their traceability, control systems to limit
or prohibit designated chemical inputs (dyes and auxiliaries) and accessories, separation and identification
systems, environmental management, contamination and residue testing, and social criteria (possible sources of
information: interview with management, confidential interviews with workers, personnel documents, physicalon-site inspection, unions/stakeholders).

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Sustainability at the ITOCHU Group

Society

Environment

Governance

Expansion of Environmentally Friendly Materials
The Apparel Division is building a value chain that originates with theraw materials for which we have assumed a leadership role. This is partof our attempt to evolve our businesses — the basic policy in ourcurrent mid-term management plan. We have been making efforts forseveral years to brand, commercialize our original raw material brandsof natural fibers such as HAMILTON LAMBS WOOL and ONE Cotton.
In October 2018, we agreed to establish a pilot plant for eco-friendly
cellulose fiber jointly with the Finnish forest industry leader Metsa
Group, and in February 2019, we invested in LYCRA in the United Stateswith Shandong Ruyi Technology Group in China. Furthermore, in thespring of 2019, we launched a project called "RENU", which aims toinnovate ways to realize a circular economy – the first product underdevelopment through this initiative is a recycled polyester material.
We will continue to accelerate the pace of our cooperation with global
companies toward our increasing use of environmentally friendly
materials in the future. At the same time, we will work to acquirecertification in the spinning, weaving/knitting and sewing processes andto expand internal cross-company business toward establishingbranding and traceability up to commercialization – our medium term
target.

"RENU" project aimed at realizing acircular economy

ONE Cotton (ONE is an abbreviation for Organic Natural Ethical)(https://www.ito-rium.com/brands/one-cotton.php)
Commitment of Protecting Forests through Material Sourcing of MMCF
(https://www.itochu.co.jp/en/csr/pdf/commitment_of_protecting_forests_2019.pdf)
RENU™ Project (https://renu-project.com/)

Performance Data of Organic Cotton Procurement
All organic cotton is GOTS certified and traceable.

Item

FYE 2017

FYE 2018

FYE 2019

FYE 2020

Organic cotton handled (1,000 kg)

449

556

900

460

Percentage of cotton trade

7%

9%

32.2%

18.2%

Traceability of organic cotton

100%

100%

100%

100%

GOTS certification of organic cotton

100%

100%

100%

100%

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