[Translation]

Chiyoda Corporation Corporate Governance Policy(Revised on December 26, 2018)

This policy sets forth the basic views and basic guideline of Chiyoda Corporation (hereinafter the“Company”) with regard to corporate governance with the objective of contributing to the sustained
growth and the enhancement of the mid- to long-term corporate value of the Company and its groupcompanies.
I.

Basic Views on Corporate Governance
The Company believes that management that earns the trust and empathy of all its stakeholders,
including shareholders, customers, business partners, creditors, employees and local
communities, is the basis of our corporate activities, and are working to continue to strengthen
our management foundation and ensure sound and transparent management with the objectiveof sustained growth in the mid- to long-term. We uphold the continued strengthening of corporate
governance and the development and reinforcement of an internal control system as important
issues, and make efforts to put these into practice.

II.

Basic Guideline on Corporate Governance
Chapter 1 Securing the Rights and Equal Treatment of Shareholders
1. Securing the Rights of Shareholders
The Company establishes an environment that enables the timely and appropriate
disclosure of information and the smooth exercise of voting rights in order to substantiallysecure the rights of shareholders.
2. Exercise of Shareholder Rights at General Shareholder Meetings
The Company regards the General Meeting of Shareholders not only as the highest
decision-making body of the Company, but also as a valuable means of communication withshareholders, and establishes an environment conducive to shareholders exercising theirvoting rights including those overseas not only by ensuring a period to review proposals
through the early dispatch of convocation notices, but also by determining a date formeetings that allows the highest possible number of shareholders to attend, and in the caseof those shareholders unable to attend, organizing methods for shareholders to exercise
their voting rights by arranging the mailing of voting ballots, the exercising of voting rights via
the Internet, and providing English translations of convocation notices.
3. Basic Strategy for Capital Policy
The Company’s basic policy is to pay dividends in consideration of the need to enhance
the financial structure for future expansion of business domains and other matters, while
maintaining distribution of profits to shareholders.

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4. Policy Shareholdings
The Company’s principle policy is that its ownership of listed shares other than for pureinvestment purposes (so-called policy shareholdings) is limited to instances where the“maintenance and strengthening of business relationships” as a result of said ownershipcontributes to the Company’s business. With regard to the main shares among the listed
shares owned, Board of Directors regularly examines the aims and rationality of saidownership. With regard to the exercise of voting rights relating to policy shareholdings, theCompany decides on the exercise of those voting rights from the perspective of the mutual
sustained growth and mid- to long-term enhancement of the corporate values of theCompany and its investee companies.
5. Anti-Takeover Measures
The Company believes that it is of the utmost importance to enhance the corporate value
through sustained growth, and does not plan on taking so-called anti-takeover measures
such as issuing stock acquisition rights.
6. Capital Policy that May Harm Shareholder Interests
In the event that the Company is to implement capital policies that have an impact on theinterests of shareholders, the Board of Directors among others shall resolve such policies
following sufficient deliberation, and the Company makes efforts to provide sufficient
explanations to shareholders, including by disclosing information regarding the objectives ofthe policies in a timely manner and by providing explanations to the General Meeting of
Shareholders and financial results presentations, as necessary. Additionally, the Audit andSupervisory Committee conducts audits to determine whether proper procedures are being
undertaken with regard to such capital policies, including obtaining the opinions of
independent third parties in accordance with the Tokyo Stock Exchange Listing Rules.
7. Related Party Transactions
With regard to competition and conflict-of-interest transactions between the Company andDirectors, the Company obtains the approval of the Board of Directors in accordance with theRules of the Board of Directors. With regard to transactions with major shareholders, theCompany undertakes careful investigation that such transactions do not constitute profit
sharing and, in relation to matters of greater importance, obtains the approval of the Board of
Directors. The Company makes efforts to ensure transparency and fairness in discussions
by the Board of Directors, including by hearing the opinions of third parties such as legal
experts, as necessary.

Chapter 2 Appropriate Cooperation with Stakeholders Other than Shareholders
1. Corporate Philosophy as the Foundation of Corporate Value Creation Over the Mid- to LongTerm
The Company’s Corporate Philosophy is to “Enhance our business in aiming for harmony
between energy and the environment and contribute to the sustainable development of asociety as an integrated engineering company through the use of our collective wisdom andpainstakingly developed technology.” All employees engage in corporate activities with thisCorporate Philosophy in mind as we strive for corporate management that earns the trust and2empathy of shareholders and all our stakeholders including customers, business partners,
creditors, employees and local communities.
2. Code of Conduct
The Company enacted the Code of Conduct of the Chiyoda Group, which forms theprinciples for our business activities, and the Chiyoda Group Compliance Manual, which sets
forth compliance requirements for our business conduct. These are distributed to all
employees, including at domestic and overseas companies in the Chiyoda Group, in the formof a handbook, and are widely disseminated through our in-house Intranet and the Company’s
website.
3. Sustainability Issues, Including Social and Environmental Matters
In line with the Corporate Philosophy stated in Paragraph 1, the Company contributes tothe sustainable development of society by conducting business activities in accordance with
the Corporate SQE (Safety, Quality and Environment) Policy and the CSR Value, and bydealing with various issues relating to sustainability.
4. Ensuring Diversity, Including Active Participation of Women
The Company acts to ensure the diversity of human resources in the belief that diverse
perspectives and values reflecting various experiences, skills and attributes areadvantageous in ensuring the sustained growth of a company. With regard to the support
and promotion of the active participation of women, the Company bases its hiring decisions
on the same selection criteria for men and women at the time of recruitment. Additionally,
we develop systems such as a childcare and nursing care support system, shorter working
hours system for child-raising, an overtime exemption system and a nursing-care leavesystem as measures to enable employees to continue working. The Company also draws up
action plans to promote active participation of women, and thoroughly informs these plans
to all employees.
5. Whistleblowing
The Company created a whistleblowing system and consultation system for the Chiyoda
Group in accordance with the Policy on the Development of the Internal Control System, anddeveloped a framework for the appropriate treatment of illegal acts and unethical conduct by
the organization or individuals, extending this also to domestic and overseas groupcompanies. In addition, the Company establishes operational status of internal control,
including activities related to compliance activities, as matters to be reported to the Board of
Directors, and develops a framework that enables the confirmation of implementation status.
With regard to the protection of whistleblowers or persons utilizing consultation systems,
such whistleblowers or persons who utilize consultation systems will not be treateddisadvantageously on the grounds of having made such reports or engaged in suchconsultations.
6. Fulfillment of function as the asset owner of corporate pension
The Company manages pension assets by establishing a tactical asset mix from a midand-long term vision to ensure continual payment of corporate defined-benefit pension. In
order to manage pension asset, Company forms Pension Management Committee which isorganized with CFO as the chairman and members of committee including general managers
of Finance Department, Human Resources Department and chairman of the Union as therepresentative of beneficiaries.

3Chapter 3 Ensuring Appropriate Information Disclosure and Transparency
1. Enhancement of Information Disclosure
The Company discloses corporate information actively and fairly for the purpose ofcommunication with stakeholders, including shareholders, and society at large, anddiscloses the following matters in order to ensure transparency and fairness of theCompany’s decision making and the realization of effective corporate governance.
(i)

(ii)

(iii)

(iv)

The Company’s Corporate Philosophy, Business Vision and Message fromManagement are posted on the Company’s website. In addition, the Company’s
Medium-Term Management Plan is disclosed on TDnet (Timely Disclosure Networkof Tokyo Stock Exchange) and also posted on the Company’s website.
The Chiyoda Corporation Corporate Governance Policy, which outlines theCompany’s basic views and basic guidelines on corporate governance, is posted on
the Company’s website.
The Company’s system of remuneration for Directors (excluding Audit andSupervisory Committee members) aims at strengthening the linkage withperformance, sharing values with shareholders, and increasing motivation andmorale toward improving business results. The system consists of base remuneration(corresponds to roles and responsibilities), performance-based remuneration(corresponds to the achievements for each term), and remuneration for purchase oftreasury stock (linked to long-term improvement of corporate value). The total
amounts of remuneration in each category are notified to shareholders.
Remunerations for individual Directors are decided by the CEO based on internal
remuneration criteria within the framework of total remuneration determined at theGeneral Meeting of Shareholders and following discussion among Representative
Directors in regard to management content and economic conditions as well as eachindividual’s annual evaluation. To enhance objectivity and transparence and toensure appropriate decision making processes, the Company obtains the opinions ofIndependent Directors and Full-time Audit and Supervisory Committee members who
joins the discussion. Additionally, the design of the remuneration system is reviewed
by the Board of Directors, as necessary.
The Company’s Directors and Executive Officers are people of excellent characterand insight, who are able to fulfill their roles and responsibilities from a company-wide
perspective and with a sense of social responsibility. Based upon the policies andstandards formulated at the Board of Directors, Directors and Executive Officers arenominated by Representative Directors after their discussion and decided by the
Board of Directors.To enhance objectivity and transparence and to ensure
appropriate decision making processes, Company obtains the opinions for theselection process from Independent Directors and the Full-time Audit andSupervisory Committee Members in the discussion during the selection process. In
the event of breach of laws and/or Articles of Incorporation or any other reasons for
impracticability of the job execution of Board Member or Executive Officers, Board of
Directors deliberates and decides dismissal, other penalization or make a motion of
dismissal to Shareholders Meeting regarding him/her.The reason for the appointmentof candidates for Directors is disclosed in the Notice of the General Meeting of
Shareholders.

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(v)

The reason for the appointment of candidates for Directors is disclosed in the Noticeof the General Meeting of Shareholders.

2. External Accounting Auditor
The Company recognizes that the external accounting auditor owes responsibility toshareholders and investors, and takes necessary steps to ensure proper auditing. When
determining the validity of audit methods used by the external accounting auditor and theiraudit results, the Audit and Supervisory Committee monitors and verifies whether necessary
and sufficient materials are supplied in a timely and appropriate manner within the preagreed audit schedule in order to ensure independence and audit quality. Additionally, theAudit and Supervisory Committee formulates standards in order to appropriately select andevaluate the candidate for external accounting auditor.

Chapter 4 Responsibilities of the Board of Directors
1. Roles and Responsibilities of the Board (1)The Company’s Board of Directors regards one of its main roles and responsibilities to be
setting forth the major strategic direction of the Company. The Board undertakes constructive
discussions through the free and vigorous exchange of opinions, including with Outside
Directors, over matters such as company-wide management strategies and management
plans. Board members receive reports on the execution status of management strategies
and the progress of management plans, and consider the aforementioned strategic direction
when making decisions on such significant business execution. To implement prompt
decision making over the Company’s business execution, the Company establishes the
Executive Committee composed of Representative Directors as the decision-making bodyfor matters relating to business execution, defining the scope of matters to be discussed
under the Rules of the Board of Directors and the Rules of the Executive Committee to clarify
the scope of delegation.
With regard to the succession plan of President & CEO or other management, Board of
Directors engages in discussions to reflect variations of environments and situations
surrounding the Company and progress of business plan and furthermore, proactively
develops sophisticated, experienced and skilled resources throughout the management
development program.
2. Roles and Responsibilities of the Board (2)The Company’s Board of Directors regards one of its main roles and responsibilities to be
the development of an environment that supports appropriate risk-taking by senior
management, and encourages management to put forward proposals that will contribute toactive and sustained growth by adopting a creative and innovative approach to businessexecution. To ensure accountability as a company, the Board of Directors sufficiently
considers proposals at Board meetings through the free and vigorous exchange of opinions,
including with Outside Directors, and supports senior management in its role as the Boardof Directors by enabling the prompt and decisive execution of proposals.
3. Roles and Responsibilities of the Board (3)The Company’s Board of Directors regards one of its main roles and responsibilities to be
the implementation of an effective framework to oversee Directors, and, to this end, appoints
Outside Directors with objective perspectives. In terms of performance evaluation, the Board

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evaluates the performance and contribution by each main business sector and also makes
efforts to reflect upon important personnel affairs including Board Members who are not Audit
and Supervisory Committee Member. In addition, the Company’s Board of Directors
develops and oversees a framework for the timely and precise disclosure of information, andalso creates a framework to enable regular reporting on the frameworks of internal controls
and risk management to the Board of Directors.
4. Roles and Responsibilities of Audit and Supervisory Committee Members and the Audit andSupervisory Committee
The Company establishes the Audit and Supervisory Committee consisting of three or more
Audit and Supervisory Committee members, the majority of whom are Outside Directors.
The Audit and Supervisory Committee performs its duties from an independent and objective
perspective, including audits and supervision of the execution of duties by Directors, in
keeping with their fiduciary responsibility to shareholders. The Audit and Supervisory
Committee shall appoint by resolution full-time Audit and Supervisory Committee members.
In addition, each Audit and Supervisory Committee member exercises voting rights atmeetings of the Board of Directors, utilizing their respective knowledge and experience.
5. Fiduciary Responsibilities of Directors
The Company recognizes that appropriate cooperation with various stakeholders isessential for the sustained growth of the Company and for the creation of a mid- to long-term
corporate value. In order to achieve this, the Company’s Directors and management act inkeeping with their position and roles based on full awareness of their fiduciary responsibility
to shareholders.
6. Business Execution and Oversight of the Management
To ensure the efficiency of independent and objective management oversight, theCompany appoints multiple Outside Directors who keep a certain distance from businessexecution.
7. Roles and Responsibilities of Independent Directors
The Company’s Board of Directors provides advice on the implementation of management
policies and management plans to promote the sustained growth of the Company andenhance its mid- to long-term corporate value, and oversees matters such as businessexecution and conflicts of interest. Independent Directors fulfill the role of properly reflecting
the opinions of stakeholders to the Board of Directors from an independent and objective
perspective. The Company promotes the development of an environment that enables
Independent Directors to satisfy such roles and responsibilities.
8. Effective Use of Independent Directors
The Company recognizes that Independent Directors make a contribution to the sustained
growth and enhancement of the mid- to long-term corporate value of the Company, andtherefore appoints multiple Independent Directors in principle. In addition, Outside Directors,
including Independent Directors, make opportunities for regular meetings so as to exchange
information and share awareness of issues from an objective perspective.
9. Independence Standards and Qualification of Independent Directors
The Company appoints Outside Directors from among persons who have a practicalperspective as a corporate manager and persons who have an objective and professional

6perspective based on strong insight into world affairs, social and economic trends, and thelike. The standards for this independence are set forth in the Attachment and state that theCompany’s management does not exert any significant influence over said persons, andconversely that said persons do not exert any significant influence over the Company’s
management, and that no potential conflict of interest exists with general shareholders.
10. Use of Optional Approach
The Company considers the discretionary use of committees as necessary when adopting
the most appropriate structure for the characteristics of the Company from among theinstitutional designs set forth in the Companies Act.
11. Preconditions for Effectiveness of the Board of Directors
The Company’s Board of Directors ensures diversity through its composition by persons
with varying backgrounds in expertise and experience, and considers improvements to theeffectiveness of the Board as necessary by conducting regular self-evaluations, including
with Outside Directors.
(i) Concept of the Diversity and Scale of the Board
In accordance with the Articles of Incorporation, the Company’s Board of Directors is
composed of a maximum of 12 Directors who are not Audit and Supervisory Committee
members, and a maximum of five Directors, Audit and Supervisory Committee, andensures a balance and diversity of knowledge, experience and ability as a Board of
Directors overall by combining Outside Directors with experience and insight in theirrespective career backgrounds with Directors who possess professional competence andknowledge in areas of corporate planning, human resources and corporate affairs, finance& accounting, business development, technology & engineering, legal and project
operations. With regard to Directors, Audit and Supervisory Committee, one or more areappointed who possess appropriate knowledge of finance and accounting.
(ii) Concurrent Posts Held by Directors
The Company shall make annual disclosures through the Notice of the General Meetingof Shareholders with regard to concurrent posts held by the Company’s Directors as
executives and employees of other listed companies.
(iii) Evaluation of the Effectiveness of the Board
The Company conducts evaluations of the effectiveness of the Board of Directors,
considers improvements to the operation of the Board as necessary, and discloses asummary of the evaluation results in its Tokyo Stock Exchange “Corporate Governance
Report.”
12. Active Board Deliberations
The Company makes efforts to develop a framework and environment to allow for free,vigorous and constructive discussion and exchange of opinions by the Board of Directors,
including issues raised by Outside Directors, by reviewing agenda items for Board meetings
as necessary and augmenting explanations of agenda items in advance.
13. Information Gathering and Support Structure
The Company’s Directors request relevant materials and information necessary for the
execution of their duties from the appropriate sectors, while those sectors supply the7applicable materials and information in accordance with said requests. With regard to the
Audit and Supervisory Committee, in order to enhance its audit and supervisory activities,
dedicated staff are assigned to assist the execution of these duties.
14. Training of Directors
When Directors are appointed, the Company provides opportunities for them to sufficiently
understand their roles and responsibilities (including legal responsibilities). Following their
appointment, the Company creates opportunities for trainings in which Directors are able toparticipate on an ongoing basis, such as internal seminars by visiting lecturers and trainings
sponsored by external organizations covering matters such as corporate governance, crisis
response, compliance and safety. When Outside Directors are appointed, the Company
provides opportunities for them to acquire necessary knowledge of the Company’s business.
The Company supports the costs for such trainings for Directors, and confirms their statusof implementation with the Audit and Supervisory Committee.

Chapter 5 Dialog with Shareholders
1. Policy for Constructive Dialog with Shareholders
 The Company’s basic IR policy is to make efforts to provide accurate and prompt
explanations of the Company’s management status and operations policy by upholding
two-way communication through dialog with shareholders and investors, and to work
toward maximizing corporate value by reflecting the opinions and requests ofshareholders and investors in its management.
 Each Director puts together frameworks that are organically linked through information
sharing and the exchange and deliberation of opinions between the IR department andeach department, and provides explanations on corporate management and businessactivities at the General Meeting of Shareholders and briefing sessions each quarter for
analysts and institutional investors as an opportunity for communication with shareholders
and investors. Additionally, Directors provide appropriate means for individual meetings
for analysts and institutional investors.
 The Company also focuses on dialog with overseas shareholders and investors, taking
into account its shareholder structure. The Company holds regular financial resultspresentations by the CFO and other officers in focus overseas regions to proactively
respond to overseas requests for meetings.
 Opinions obtained through dialog with shareholders and investors are relayed to theBoard members as necessary, and information is shared within the Company throughmeetings such as the liaison meeting for employees.
 Information stemming from this dialog is managed and handled in such a way that does
not infringe on the regulations on insider transactions.
2. Establishing and Disclosing Business Strategy and Business Plans
The Company formulates Medium-Term Management Plans and discloses targets for its
profit plan, capital plan and other plans on TDnet as well as posting these targets on the
Company’s website. Progress toward these targets is reported at the General Meeting of
Shareholders and financial results presentations. At these opportunities, the Company will
be mindful of capital cost and makes efforts to provide clear explanations to shareholders
using reader-friendly words and logic for their clear understanding on the Company’sbusiness policies.

8Supplementary Provisions
1. This policy is effective from October 23, 2015.
2. Any revision or abolition of these policies shall be decided by the Board of Directors. However,minor amendments, such as changes to wording, can be made with the approval of the Division
Director of Corporate Management Division.

9(Attachment)[Independence Standards]

To achieve appropriate decision making and management oversight by the Board of Directors froma variety of perspectives, the Company appoints Outside Directors from among highly insightful
persons who possess an objective and professional perspective (persons who fulfill the requirements
set forth in Article 2, Item 15 of the Companies Act). The Company bases the independence ofOutside Directors on the factors determining independence set forth by Tokyo Stock Exchange, Inc.
and deems an Outside Director to be independent if none of the following items are applicable.
1. Major Client or Supplier(1) A party for whom the Company is a major client or supplier (Note 1) or an executive thereof(2) A party that is the Company’s major client or supplier (Note 2) or an executive thereof
2. Experts
Consultants, accountants, lawyers and persons affiliated with such organizations who receive
annual compensation of 10 million yen or more in cash or other assets from the Company, otherthan remuneration for Directors
3. Major Shareholders
Major shareholders of the Company (a party holding 10% or more direct or indirect voting rights)
or an executive thereof
4. Donation Recipients
Recipients to whom the Company donates in excess of an annual 10 million yen or an executive
thereof
5. Historical Requirements
A party to whom any of 1. to 4. above applies in the past 10 years
6. Close Relatives
Spouse or relative within second degree of kinship of the following persons(1) A party to whom any of 1. to 5. above applies(2) A Director, Executive Officer or other core employee of the Company or its subsidiary (Note 3)
7. Any party other than the above in special circumstances that do not allow said party to fulfill duties
as an independent Director, including the existence of conflict of interest with the Company
The Company’s Board of Directors shall make efforts to nominate as candidates for the position of
Independent Director persons who can be expected to contribute to frank, lively and constructive
deliberations at the Board of Directors in accordance with these standards.
(Notes) 1. “A party for whom the Company is a major client or supplier” refers to a party who received payment
equivalent to 2% of said party’s annual consolidated net sales or payment of 100 million yen or
more, whichever is the higher of the two, in the most recent fiscal year.

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2. “A party that is the Company’s major client or supplier” refers to a party whose transactions with
the Company were equivalent to 2% or more of the Company’s annual consolidated net sales in
the most recent fiscal year, or a party who provided loans to the Company equivalent to 2% ormore of the Company’s consolidated total assets in the most recent fiscal year.
3. “Core employee” refers to Division Director or superior.

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