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

Securities Code: 4540
June 5, 2020
To Our Shareholders:
Terukazu Kato
President, Representative Director and CEO
TSUMURA & CO.
17-11 Akasaka 2-chome, Minato-ku, Tokyo

Notice of the 84th Ordinary General Meeting of Shareholders
We are pleased to announce the 84th Ordinary General Meeting of Shareholders of TSUMURA & CO.
(the “Company”), which will be held as indicated below.
In order to prevent the risk of infection with the new coronavirus (COVID-19), we would kindly ask
you to refrain from attending this year’s meeting in person as much as possible, and encourage you to
exercise your voting rights in writing (and send by post mail) or the Internet.
You may exercise your voting rights either of the following ways. Please review the attached Reference
Documents for General Meeting of Shareholders, and exercise your voting rights by 5:45 p.m. on Thursday,June 25, 2020 (JST).
Exercise of voting rights in writing
Please indicate your approval or disapproval to each proposal on the enclosed voting card, and return it sothat it will be received by us no later than the above date and time.
Exercise of voting rights via the Internet
Please access the website for exercising voting rights (https://evote.tr.mufg.jp/), follow the directions on
the screen, and indicate your approval or disapproval to each proposal no later than the above date and time.

Notice Regarding COVID-19
In order to prevent the risk of infection with COVID-19, we would kindly ask you to refrain from
attending this year’s meeting in person as much as possible, and encourage you to exercise your voting
rights in writing (and send by post mail) or the Internet.
Shareholders attending the General Meeting of Shareholders in person are requested to take measures toprevent infection. Moreover, Directors and staff running the meeting at the venue for the General Meetingof Shareholders will be taking measures, such as wearing masks, and we ask for your cooperation with
infection prevention measures for the safety of shareholders, such as measuring body temperature andwearing masks. In addition, as a measure to prevent further spread of infection, our operating staff may ask
those shareholders who appear ill to kindly refrain from entering the venue.

-1-

1. Date and Time:

Friday, June 26, 2020, at 10:00 a.m.

2. Venue:“Ho’oh,” 1st floor, THE CAPITOL HOTEL TOKYU
10-3 Nagatacho 2-chome, Chiyoda-ku, Tokyo

3. Purpose of the Meeting
Matters to be reported
1. Business Report and Consolidated Financial Statements for the 84th fiscal year
(from April 1, 2019 to March 31, 2020), and results of audits of the Consolidated
Financial Statements by the Accounting Auditor and the Audit and Supervisory
Committee
2. Non-consolidated Financial Statements for the 84th fiscal year (from April 1,
2019 to March 31, 2020)
Matters to be resolved
Proposal No. 1: Appropriation of Surplus
Proposal No. 2: Election of Six (6) Directors (excluding Directors who are Audit andSupervisory Committee Members)
Other Matters Regarding the Exercise of Voting Rights
 If a voting card is received without giving any indication of approval or disapproval of any or all of the
proposals, it will be counted as a vote for the proposal concerned.
 If you vote multiple times via the Internet indicating different positions on the same proposal in eachvoting exercise, only your most recent vote will count as valid.
 If you exercise your voting rights both in writing and via the Internet, only the vote placed via the Internet
will be treated as valid.
 If you are unable to attend the general meeting of shareholders in person, you may appoint anothershareholder with voting rights in the Company to attend as your proxy. Please note, however, that it isnecessary to submit a document evidencing the authority of proxy.
Internet Disclosure
Pursuant to the relevant laws and regulations and the Company’s Articles of Incorporation, the following
items of information are posted on the Company’s website instead of being included in the Reference
Documents for General Meeting of Shareholders.
i) “Consolidated Statement of Changes in Equity” and “Notes to Consolidated Financial Statements”
sections of Consolidated Financial Statementsii) “Non-consolidated Statement of Changes in Equity” and “Notes to Non-consolidated Financial
Statements” sections of Non-consolidated Financial Statements
https://www.tsumura.co.jp/zaimu/meeting/general/pdf/internet_084.pdf(in Japanese only)
The Consolidated Financial Statements and the Non-consolidated Financial Statements audited by the
Audit and Supervisory Committee and the Accounting Auditor include the documents attached to thisnotice and the Consolidated Statement of Changes in Equity, the Notes to Consolidated Financial
Statements, the Non-consolidated Statement of Changes in Equity and the Notes to Non-consolidated
Financial Statements posted on the Company’s website.
If any changes are made to the Reference Documents for General Meeting of Shareholders, the Business
Report, the Consolidated Financial Statements or the Non-consolidated Financial Statements, such changes
will be posted on the Company’s website.
https://www.tsumura.co.jp/-2-Reference Documents for General Meeting of Shareholders
Proposal No. 1
Proposal No. 1: Appropriation of Surplus
The Company regards the return of profit to shareholders as its important policy. We will aim to achievesustained growth going forward while maintaining a policy to pay stable dividends, taking into considerationsuch matters as medium- and long-term levels of earnings and cash flows.
The Company will allocate funds from internal reserves for investment in the areas such as capital
expenditure and research and development that are deemed to boost the future corporate value of theCompany.
In line with the aforementioned policy, the Company proposes to pay year-end dividends for the current
fiscal year as follows:Year-end dividends
1)
2)

3)

Type of dividend property
Cash
Allotment of dividend property and their aggregate amountThe Company proposes to pay a dividend of ¥32 per common share of the Company.
The total dividends will be ¥2,448,266,016.
Effective date of payment of dividends of surplus
June 29, 2020-3-

Proposal No. 2
Proposal No. 2: Election of Six (6) Directors (excluding Directors who are Audit and Supervisory
Committee Members)
The terms of office of all six (6) Directors (excluding Directors who are Audit and Supervisory Committee
Members) will expire at the conclusion of this general meeting. Accordingly, the Company proposes to electsix (6) Directors (excluding Directors who are Audit and Supervisory Committee Members).
Following discussions by the Audit and Supervisory Committee based on deliberations of theNomination/Remuneration Advisory Committee attended by one (1) Audit and Supervisory Committee
Member, the Audit and Supervisory Committee believes that the nominating procedure was properly
followed and all candidates are adequate to serve as Directors of the Company.
The candidates for Directors (excluding Directors who are Audit and Supervisory Committee Members)
are as follows:
Candidate
No.

Name

1

Terukazu Kato

2

Susumu Adachi

3

Muneki Handa

4

Kenichi Matsui

Outside Director

Reelection

OutsideIndependent

5

Hiroshi Miyake

Outside Director

Reelection

OutsideIndependent

6

Tadashi Okada

NewElection

OutsideIndependent

Current Position in the Company
President, Representative
Director and CEO
Director, Managing Executive
Officer and COO
Director, Managing Executive
Officer and CFO-4-

Reelection
Reelection
Reelection

1

Terukazu Kato
Date of Birth(Age 56)

August 26, 1963

Current Position in the Company

President, Representative Director andCEO

Reelection
To our shareholders
Based on its corporate philosophy of “The Best of Nature and Science,” the Tsumura Group willcontribute to the medical field and to people’s health through the stable supply of high-quality Kampo
medicines made using naturally derived crude drugs. At the same time, we will fulfill our corporate social
responsibilities by accelerating initiatives for resolving environmental and social issues and reinforcing
corporate governance.
Through our endeavor to achieve the strategic challenges of our third medium-term management plan,we aim to be a value-creation company that contributes to people’s health through our Kampo business. As
a President of the Tsumura Academy, our in-house education institution, I will make every effort to develop
management-level human resources and to disseminate our corporate philosophy.
We will devote our utmost energies in improving the corporate value in order to meet the expectations of
our Shareholders.
 Career summary, position and responsibility in the Company, and major positions held outside theCompany
Apr. 1986
Aug. 2001
Jan. 2006
Apr. 2007
Jun. 2011
Jun. 2012
Jun. 2015
Jun. 2019

Joined the Company
President and Representative Director, TSUMURA USA, INC.
Head of Public Relations Department, TSUMURA & CO.
General Manager, Head of Corporate Communications Department, TSUMURA &CO.
Director and Executive Officer, Head of Corporate Communications Department,
TSUMURA & CO.
President and Representative Director, TSUMURA & CO.
President and Representative Director and President and Executive Officer,
TSUMURA & CO.
President, Representative Director and CEO, TSUMURA & CO. (incumbent)

 Number of theCompany’s
Shares Owned
28,100 Shares Status ofattendance to
Board ofDirectors
meeting:
19/19 (100%)
 Material
relationshipwith theCompanyNone Reasons for nominating Mr. Terukazu Kato as a candidate for Director
As a chairman of the Board of Directors, Mr. Terukazu Kato has operated the Company’s corporate governance systemand strengthened it in several phases, and worked to structure the Board of Directors to have majority Outside Directors,
establish the Nomination/Remuneration Advisory Committee with an Outside Director as its committee chairman, andimprove the effectiveness of the Board of Directors, while successfully carrying out his responsibilities in making
important management decisions and supervising the execution of business.
In addition, he delegated business execution authority to COO and finalized the group-wide management policy as wellas corporate strategy as CEO, established management system, carried on external negotiations and made efforts indeveloping management-level human resources. In order for the Company to further pursue the aim of achieving
sustainable growth and enhancing its corporate value while maintaining the philosophy-based management approach, theBoard of Directors believes that he is one of the most well-qualified candidates, and thus recommends his re-election.
If his election as a Director is approved, Mr. Kato will assume the position of President, Representative Director and CEOof the Company.

-5-

2

Susumu Adachi
Date of Birth(Age 57)

February 3, 1963

Current Position in the Company

Director, Managing Executive Officer
and COO

Reelection
To our shareholders
Fiscal 2021 will be the second year of our three-year medium-term management plan, “Creating New
Value through Innovations in Kampo - Next Stage -,” which mainly focuses on sustainable expansion of
Kampo market in Japan and establishing the foundation of business in China, where we aim to build abusiness in a scale equivalent to or exceeding that in Japan in the coming future. As for Kampo business inJapan, we are succeeding in expanding the business despite the COVID-19 outbreak from the beginning of2020 on top of the severe business environment we have been experiencing. As for the Chinese business,
we now have a firm foundation for raw material procurement, as Tianjin China Medico Technology Co.,
Ltd., one of the best crude drug related business in China, became our group company. Going forward, we
will devote our utmost energies to implement the management plan to improve corporate value of the
Tsumura Group and meet the expectations of our shareholders
 Career summary, position and responsibility in the Company, and major positions held outside theCompany
Apr.
Apr.
Apr.
Apr.
Apr.

1987
2013
2015
2016
2018

Jun. 2018
Jun. 2019

Joined the Company
Head of Corporate Planning Department, TSUMURA & CO.
General Manager, Head of Corporate Planning Department, TSUMURA & CO.
Executive Officer, Head of Corporate Planning Department, TSUMURA & CO.
Managing Executive Officer, Head of Corporate Planning Department, TSUMURA& CO.
Director and Managing Executive Officer, Head of Corporate Planning Department,
TSUMURA & CO.
Director, Managing Executive Officer and COO, TSUMURA & CO. (incumbent)

 Number of theCompany’s
Shares Owned
12,200 Shares Status ofattendance to
Board ofDirectors
meeting:
19/19 (100%)
 Material
relationshipwith in the
CompanyNone Reasons for nominating Mr. Susumu Adachi as a candidate for Director
Mr. Susumu Adachi has experience as a member of senior management in our group company in China and extensive
experience and insight as an executive officer in charge of corporate planning, finance/accounting, public relation/IR,
information technology and product strategy at the Company. In addition, as COO, he has been engaged in group-widebusiness operation based on management policy and corporate strategy and has been controlling the overall businessexecution to achieve the plan. The Board of Directors has full confidence in his ability to carry out his responsibilities
including making important management decisions at the Board of Directors meetings and supervising the execution ofbusiness. Therefore, the Board of Directors recommends his re-election as a Director.
If his election as a Director is approved, Mr. Adachi will assume the position of Director, Managing Executive Officer and
COO of the Company.

-6-

3

Muneki Handa
Date of Birth(Age 57)

July 7, 1962

Current Position in the Company

Director, Managing Executive Officer
and CFO

Reelection
To our shareholders
The Tsumura Group is promoting its business based on the third medium-term management plan thatcovers the three years beginning from fiscal 2020. Based on the plan, we are working for sustainable
expansion of Kampo market in Japan, and as for the Chinese business, we are pressing ahead with building
the foundation for the Chinese business.
These are the road maps to realizing our Long-term business vision, “aim to be a value-creation company
that contributes to people’s health through its Kampo business.” I will devote my utmost energies to achieve
the goals of “establishing a Kampo medicine business” as well as “contributing to the health of China’s
citizens,” so that we will be widely acknowledged from society, and be able to meet expectations of ourvarious stakeholders including shareholders.
 Career summary, position and responsibility in the Company, and major positions held outside theCompany
Apr. 1985
Jun. 2014
Jun. 2015
Jun. 2016
May 2019
Jun. 2019

Joined The Mitsubishi Bank, Limited (currently MUFG Bank, Ltd.)
Executive Officer and Managing Director, Head, Retail Credit Division, The Bank ofTokyo-Mitsubishi UFJ, Ltd. (currently MUFG Bank, Ltd.)
Deputy President, Mitsubishi UFJ Capital Co., Ltd.
President, Mitsubishi UFJ Capital Co., Ltd.
Advisor, TSUMURA & CO.
Director, Managing Executive Officer and CFO, TSUMURA & CO. (incumbent)

 Number of theCompany’s
Shares Owned
1,300 Shares Status ofattendance to
Board ofDirectors
meeting:
15/15 (100%)
 Material
relationshipwith in the
CompanyNone Reasons for nominating Mr. Muneki Handa as a candidate for Director
Mr. Muneki Handa has years of experience working at financial institutions and extensive experience as a corporate
manager at a venture capital firm. He also has extensive insight as an Executive Officer in charge of corporate planning,accounting/finance, public relation/IR and information technology at the Company. In addition, as CFO, he has executedbusiness relating to group-wide financial strategies and IR and has formulated management plan based on management
policy and corporate strategy. The Board of Directors has full confidence in his ability to carry out his responsibilities
including making important management decisions at the Board of Directors meetings and supervising the execution ofbusiness. Therefore, the Board of Directors recommends his re-election.
If his election as a Director is approved, Mr. Handa will assume the position of Director, Managing Executive Officer and
CFO of the Company.

-7-

4

Kenichi Matsui
Date of Birth(Age 70)

Current Position in the Company

Outside Director

July 5, 1949

Reelection Outside Independent
To our shareholders
We have created unparalleled Kampo value chain based on our corporate philosophy, “The Best of Natureand Science.” In the face of natural threat, we will contribute to people’s health through Kampo, naturally
derived crude drugs. Despite the severe situation, our employees are striving to maintain stable supply of
Kampo as well as research and development of Kampo. As an Outside Director, I believe it is my mission
to protect these employees and to meet the expectations of various stakeholders, not to mention that of
medical practitioners.
We have been committing to developing next-generation human resources by establishing a Kampo
medicine business in Japan and creating the foundation for the Chinese business. Because this is a time ofuncertainty, diversity and innovation as well as ability to judge risks is essential. I will take the lead as an
Outside Director and fulfill my responsibilities.
 Career summary, position and responsibility in the Company, and major positions held outside theCompany
Apr. 1972
Jun. 2001
Apr. 2003

Joined Idemitsu Kosan Co., Ltd.
General Manager of Accounting Department, Idemitsu Kosan Co., Ltd.
Executive Officer, General Manager of Accounting Department, Idemitsu Kosan
Co., Ltd.
Jun. 2004
Managing Executive Officer, General Manager of Accounting Department,
Idemitsu Kosan Co., Ltd.
Jun. 2005
Managing Director, Idemitsu Kosan Co., Ltd.
Jun. 2010
Executive Vice President, Representative Director, Idemitsu Kosan Co., Ltd.
Jun. 2014
Outside Director, The Mie Bank, Ltd.
Jun. 2015
Outside Director, TSUMURA & CO. (incumbent)
Apr. 2018
Outside Director (Audit and Supervisory Committee Member), The Mie Bank, Ltd.
(incumbent) Tenure as an Outside Director
At the conclusion of this general meeting, Mr. Matsui will have served in the position for five (5)years.

 Number of theCompany’s
Shares Owned
3,400 Shares Status ofattendance to
Board ofDirectors
meeting:
18/19 (94.7%)
 Material
relationshipwith in the
CompanyNone Reasons for nominating Mr. Kenichi Matsui as a candidate for Outside Director
Mr. Kenichi Matsui has extensive experience and insight as a corporate manager, developed over many years. The Boardof Directors has full confidence in his ability to carry out his responsibilities including making important management
decisions and supervising the execution of business for the Company. Therefore, the Board of Directors recommends his
reelection as an Outside Director.
 Degree of independence
Mr. Kenichi Matsui concurrently serves as an Outside Director (Audit and Supervisory Committee Member) of The Mie
Bank, Ltd. In view of the fact that there is no business relationship between the Company and the bank, and Mr. Kenichi
Matsui satisfies the standards for determination of independence of Outside Directors, the Board of Directors believes Mr.
Kenichi Matsui has a high degree of independence.
The Company has submitted notification to Tokyo Stock Exchange, Inc. that Mr. Kenichi Matsui has been appointed as anindependent officer as provided for in Article 436-2 of the Securities Listing Regulations of the aforementioned exchange.
 Summary of limited liability agreement with Mr. Kenichi Matsui
Pursuant to Article 427, paragraph 1 of the Companies Act and the Company’s Articles of Incorporation, the Company hasentered into an agreement with candidate for Outside Director Mr. Kenichi Matsui to limit his liability for damages arisingfrom neglecting his liability. The limit under the agreement is the amount provided for by the applicable laws andregulations. If Mr. Kenichi Matsui is reelected, the Company plans to renew the aforementioned limited liability
agreement.

-8-

5

Hiroshi Miyake
Date of Birth(Age 70)

Current Position in the Company

Outside Director

August 4, 1949

Reelection Outside Independent
To our shareholders
The overwhelming impact of the novel coronavirus is being felt across the world economy and corporate
management. Under the corporate philosophy, “The Best of Nature and Science,” I believe it is critical tofocus on practicing management that takes root in our corporate mission, “To contribute to the unparalleled
medical therapeutic power of the combination of Kampo medicine and Western medicine,” and therefore I
will make every effort to fulfill our mission.
Because we are in such period, responding to various social demands will help promote sound corporate
management. I will actively supervise, check and make suggestions to management, and also devote myutmost energies to contribute to the Company’s critical tasks of success in the development of the Chinese
business, achieving the medium-term management plan and developing next-generation human resourcesby leveraging my insight that I have gained from past experience.
 Career summary, position and responsibility in the Company, and major positions held outside theCompany
Apr. 1973
Oct. 2000

Joined Mitsubishi Corporation
General Manager, Paper & Packaging Raw Materials Division, Mitsubishi
Corporation
Apr. 2001
Deputy Division COO, General Merchandise Division, Mitsubishi Corporation
Apr. 2003
Deputy General Manager, Kansai Branch, Mitsubishi Corporation
Apr. 2005
Senior Vice President, Mitsubishi Corporation
President, Mitsubishi International GmbH, and Deputy Regional CEO for Europe
May 2009
Advisor, Tokai Pulp & Paper Co., Ltd.
Jun. 2009Managing Executive Officer, Tokushu Tokai Holdings Co., Ltd.
Jun. 2010
Senior Managing Executive Officer, Tokushu Tokai Paper Co., Ltd.
Jun. 2014
Director, Executive Vice President, Tokushu Tokai Paper Co., Ltd.
Jun. 2015
Representative Director, Executive Vice President, Tokushu Tokai Paper Co., Ltd.
Jun. 2016
Advisor, Tokushu Tokai Paper Co., Ltd.
Oct. 2016
Advisor, Nippon Tokai Industrial Paper Supply Co., Ltd.
Jun. 2018
Outside Director, TSUMURA & CO. (incumbent) Tenure as an Outside Director
At the conclusion of this general meeting, Mr. Miyake will have served in the position for two (2)years.

 Number of theCompany’s
Shares Owned
900 Shares Status ofattendance to
Board ofDirectors
meeting:
18/19 (94.7%)
 Material
relationshipwith in the
CompanyNone Reasons for nominating Mr. Hiroshi Miyake as a candidate for Outside Director
Mr. Hiroshi Miyake has extensive experience and insight as a corporate manager developed over many years and businessexperience in and outside Japan. The Board of Directors has full confidence in his ability to carry out his responsibilities
including making important management decisions and supervising the execution of business for the Company. Therefore,
the Board of Directors recommends his re-election as an Outside Director.
 Degree of independence
Since Mr. Hiroshi Miyake satisfies the standards for determination of independence of Outside Directors, the Board of
Directors believes Mr. Hiroshi Miyake has a high degree of independence.
The Company has submitted notification to Tokyo Stock Exchange, Inc. that Mr. Hiroshi Miyake has been appointed as
an independent officer as provided for in Article 436-2 of the Securities Listing Regulations of the aforementioned
exchange.
 Summary of limited liability agreement with Mr. Hiroshi Miyake
Pursuant to Article 427, paragraph 1 of the Companies Act and the Company’s Articles of Incorporation, the Company hasentered into an agreement with candidate for Outside Director Mr. Hiroshi Miyake to limit his liability for damages arisingfrom neglecting his liability. The limit under the agreement is the amount provided for by the applicable laws andregulations. If Mr. Hiroshi Miyake is reelected, the Company plans to renew the aforementioned limited liability
agreement.

-9-

6

Tadashi Okada
Date of Birth

New election(Age 64)

Current Position in the Company

May 1, 1956

OutsideIndependent

To our shareholders
Although the novel coronavirus is having an extremely significant impact on domestic and global
economy, our medium- to long-term commitment remains unchanged; it is to promote the third mediumterm management plan, by always keeping in mind the medium- to long-term issues such as further
advancement of aging society, utilizing IoT and AI technologies in the field of medical care and growth andexpansion of the Chinese business.
I will utilize my experience and insight gained from past years and devote my utmost energies tocontribute to management and business activities aimed at sustainable growth.
At the same time, as an Outside Director, I will endeavor to improve the effectiveness of the Board of
Directors through active discussions, to make sure that the Board will function as managing and supervisingorganization.
 Career summary, position and responsibility in the Company, and major positions held outside theCompany
Apr.
Apr.
Apr.
Apr.
Apr.

1979
2000
2003
2006
2007

Apr. 2008
Feb. 2009
Apr. 2011
Apr. 2014
Jun. 2017

Joined Komatsu Ltd.
General Manager of Business Development Department, Komatsu Ltd.
Vice President of Komatsu (China) Ltd.
General Manager of Corporate Communications Department, Komatsu Ltd.
Executive Officer, General Manager of Corporate Communications Department,
Komatsu Ltd.
Executive Officer, General Manager of Corporate Planning Division, Komatsu Ltd.
Executive Officer, Vice President of Industrial Machinery General Headquarters,
Komatsu Ltd.
Senior Executive Officer, President of Industrial Machinery Division, Komatsu Ltd.
Senior Executive Officer, Supervising Corporate Communications, CSR, General
Affairs, and Compliance, Komatsu Ltd.
Representative Director and Chairman of QUALICA Inc. (incumbent)

 Number of theCompany’s
Shares Owned
0 Shares Status ofattendance to
Board ofDirectors
meeting:  Material
relationshipwith in the
CompanyNone Reasons for nominating Mr. Tadashi Okada as a candidate for Outside Director
Mr. Tadashi Okada has extensive experience and insight as a corporate manager developed over many years and businessexperience in and outside Japan. The Board of Directors has full confidence in his ability to carry out his responsibilities
including making important management decisions and supervising the execution of business for the Company. Therefore,
the Board of Directors recommends his election as an Outside Director.
 Degree of independence
Mr. Tadashi Okada serves as Representative Director and Chairman of QUALICA Inc. In view of the fact that there is nobusiness relationship between the Company and QUALICA Inc., and Mr. Tadashi Okada satisfies the standards fordetermination of independence of Outside Directors, the Board of Directors believes Mr. Tadashi Okada has a high degreeof independence.
The Company plans to submit notification to Tokyo Stock Exchange, Inc. that Mr. Tadashi Okada has been appointed as
an independent officer as provided for in Article 436-2 of the Securities Listing Regulations of the aforementioned
exchange.
 Summary of limited liability agreement with Mr. Tadashi Okada
Conditional upon the approval and adoption of this proposal and pursuant to Article 427, paragraph 1 of the Companies
Act and the Company’s Articles of Incorporation, the Company plans to enter into an agreement with Mr. Tadashi Okada
to limit his liability for damages under Article 423, paragraph 1 of the Companies Act. The limit of liability for damages
under this agreement is the minimum liability amount provided for under the relevant laws and regulations.
(Note 1)
(Note 2)

The respective ages stated for each candidate are current as of June 26, 2020.
The status of attendance to the Board of Directors meeting stated for each candidate is based on data for fiscal
2020 (from April 1, 2019 to March 31, 2020).

- 10 -

(Reference)
Standards for Determination of Independence of Outside Directors
Of the Company’s Outside Directors, outside officers who do not fall under any of the following items shallbe determined to have independence.
1. Person who is or was in the past ten (10) years an Executive Director, Executive Officer (Shikkoyaku),
Executive Officer (Shikkoyakuin), Manager, General Manager, employee, etc. (hereinafter referred toas “executives”) of the Company or its consolidated subsidiaries
2. Person or executives of a legal entity holding, whether directly or indirectly, 10% or more of the total
number of voting rights of the Company
3. Party for whom the Company or its consolidated subsidiaries (*1) is a major business partner or
executives of such party*1. Party is defined as a “party for whom the Company or its consolidated subsidiaries is a major
business partner” if payment from the Company or its consolidated subsidiaries which such party
receives is 2% or more of its annual transaction value (non-consolidated) in the most recent fiscal
year, or if monetary finance from the Company or its consolidated subsidiaries which such party
is receiving is 2% or more of its consolidated total assets in the most recent fiscal year.
4. Major business partner of the Company or its consolidated subsidiaries (*2) or the executives of suchbusiness partner*2. Business partner is defined as a “major business partner of the Company or its consolidated
subsidiaries” if payment from such business partner which the Company or its consolidated
subsidiaries receives is 2% or more of its annual consolidated transaction value in the most recent
fiscal year, or if monetary finance from such business partner which the Company or its
consolidated subsidiaries is receiving is 2% or more of the Company’s consolidated total assets inthe most recent fiscal year.
5. Audit corporation that serves as Accounting Auditor of the Company or its consolidated subsidiaries,
or partners and others of the audit corporation
6. Consultant, attorney, certified public accountant and others who provide professional services andobtain monetary and other financial benefits exceeding a cumulative amount of ¥10 million in themost recent fiscal year from the Company, excluding officer compensation (if such financial benefits
are obtained by an organization including a legal entity and a partnership, etc. this shall apply to theperson belonging to such organization.)
7. Person or executives of a legal entity receiving donations, grants and others in the amount exceeding¥10 million from the Company or its consolidated subsidiaries in the most recent fiscal year
8. Person to whom items 2 through 7 apply during the past three (3) years
9. Person who is or was recently a spouse or within a second degree of consanguinity of executives in an
important position of the Company or its consolidated subsidiaries (hereinafter referred to as “close
relative”)
10. Close relative of a person to whom any of the items 2 through 7 apply (excluding people who are notin an important position)- 11 -

Adoption of New Corporate Governance System
The Tsumura Group formulates its long-term management visions and medium-term management plans in
response to social demand and changes in the operating environment, and initiates various measures toachieve them. Along with our value creation cycle, we have, in particular, pursued and evolved a system formaking appropriate and prompt decisions regarding corporate governance, the foundation of management.
We have established diversified and highly effective corporate governance systems in which decisions onimportant matters are not based solely on the understanding of inside directors. Rather, these decisions reflectvarious viewpoints, including those of Outside Directors, who currently account for more than half of theCompany’s Directors.
We will continue to strengthen corporate governance in order to achieve sustainable growth.

Fiscal year

’03

’04

’05

’06

’07

President andHachizaemon
Representative Director
Kazama

’08

’09

’10

’11

’12

’13

’14

’15

Junichi Yoshii

’16

’17

’18

’19

’20

Terukazu Kato

Company with

Organizational Structure

Audit andCompany with Company Auditor(s)Supervisory
Committee

CEO, COO, CFO
Number of Directors(of whom, Audit andSupervisory
Committee members)

10

Of whom, Outside
Directors0

Number of female
Directors

9

8

1

9

0

10

8

1

0

Number of Company
Auditors (of whom,
Outside Auditors)

Term of office of
Directors

11

6

9 (3)

3

5

1

2

1

4 (2)

0

1 year (director retirement age: President and Representative Director, 65;
2 years

Directors (excluding Outside Directors), 63)
Directors serving as Audit and Supervisory Committee members: 2 years
Nomination/

Advisory bodies to theBoard of Directors

Remuneration
Advisory
Committee

Executive officer system

Executive officer system- 12 -

Executive officer system(Reviewed)

Diversity of Outside Directors

Overseasmanagement
experience

Name

Management
experience

Kenichi Matsui

Executive Vice
President,
Representative
Director, Idemitsu
Kosan Co., Ltd.

Hiroshi Miyake

Representative
Director, Executive
Vice President,
Tokushu Tokai Paper
Co., Ltd.

President, Mitsubishi
International GmbH
(Germany)

Tadashi Okada

Representative
Director andChairman of
QUALICA Inc.
(incumbent)

Vice President of
Komatsu (China) Ltd.

Finance, accounting

Mitsutoshi
Matsushita
Akemi Mochizuki

Legal

GenderAttorney at law

Certified public
accountant

Female* This table presents the diversity of Outside Directors assuming the approval of Proposal No. 2 “Election ofSix (6) Directors (excluding Directors who are Audit and Supervisory Committee Members)” at theGeneral Meeting of Shareholders.
* Mr. Matsushita and Ms. Mochizuki are Audit and Supervisory Committee Members.
(Reference)
Corporate Governance of Tsumura
Basic Policy
The basic principles of Tsumura are encapsulated in its corporate philosophy of “The Best of Nature andScience” and in its corporate mission of “To contribute to the unparalleled medical therapeutic power of the
combination of Kampo medicine and Western medicine.” Guided by these principles, we adhere to a policyof implementing continuous improvements to corporate governance in order to realize ongoing growth andmedium-to-long-term increases in corporate value.
In June 2017, Tsumura transitioned from the Company with Company Auditor(s) system described in the
Companies Act of Japan to the Company with Audit and Supervisory Committee system. This move wasaimed at reinforcing the oversight and monitoring functions of the Board of Directors. Under this system,
Tsumura is working to enhance its management supervisory function and innovate its management structureby separating the supervisory function from the executive function and by appointing a majority of Outside
Directors to the Board of Directors. These measures are being implemented to continuously establish thesystems that will enable the Company to ensure the transparency, improve the efficiency, and maintain thesoundness of management.

- 13 -

Overview of Corporate Governance Systems

Please see our Integrated Report for details of corporate governance.

Board of Directors
The Board of Directors makes important decisions to ensure sustainable growth and enhance corporate value
over the medium-to-long term. The Company aims to accelerate decision-making by separating businessexecution functions from the Board of Directors. At the same time, we are strengthening the supervisory
function of general management by appointing Outside Directors to comprise the majority of the Board of
Directors and appropriately reflecting their objective views from an independent perspective as experts withextensive experience.
<Main matters during the 84th fiscal year> Checking the progress of the third medium-term management plan; Monitoring and following-up the progress of the Chinese business;
 Confirming the function of CEO, COO and CFO structure; Formulating plan and reporting on the progress of developing human resources (candidate of nextgeneration management);
 Determining the direction of the new medium-term management plan; and Evaluating the effectiveness of the Board of Directors and establishing priority themes.

- 14 -

Nomination / Remuneration Advisory Committee
The Nomination/Remuneration Advisory Committee is a voluntarily established advisory body to the Boardof Directors. The committee is composed of a majority of Outside Directors who have also been designatedas independent directors as stipulated by the Tokyo Stock Exchange (including one Outside Director who isa member of the Audit and Supervisory Committee). These Outside Directors provide advice on mattersrelated to the nomination and remuneration of Directors and Executive Officers based on inquiries by the
Board of Directors and also submit reports to the Board of Directors on these subjects.

<Main matters during the 84th fiscal year> Proposal of election and dismissal of Directors to be submitted to the General Meeting of Shareholders; Draft proposals of election and dismissal of the Representative Director to be submitted to the Board of
Directors;
 Draft proposals of candidates for Executive Officers to be submitted to the Board of Directors;
 Polices for electing Directors and Executive Officers, election process; Draft proposals for individual remuneration to be paid to Directors and Executive Officers; and Policy including the composition of Directors’ remuneration, procedure for determining remuneration of
Directors, etc.

Audit and Supervisory Committee
The Audit and Supervisory Committee audits legality and adequacy of the execution of duties by Directors
by conducting systematic audits in cooperation with Internal Auditing Department, and the Audit andSupervisory Committee itself holds hearings on the status of business execution with Executive Officers,
attends meetings of the Executive Committee and other important meetings, exchanges information with
Directors and Auditors of the Company’s subsidiaries and monitors and verifies the establishment andimplementation of internal control systems, including those related to financial reporting.

<Main matters during the 84th fiscal year> Audit policy and plan; Reelection and remuneration of audit corporation;
 Details of matters to be submitted to the General Meeting of Shareholders; Preparation of audit report; and Status of the use of hotline, etc.

Outside Directors’ Meeting
The Outside Directors’ Meeting collects and shares the information necessary for management decisionmaking. At the same time, it acts as a venue for the exchange of opinions regarding the necessity of discussions
and other matters with the Board of Directors.

<Main matters during the 84th fiscal year> Advance explanation about matters to be discussed at the Board of Directors;
 Follow-up on the Board effectiveness evaluation; and Progress report of Chinese business.

(Note)

The above shows the system in place as of the end of fiscal 2020.

- 15 -