CORPORATE GOVERNANCESUZUKEN CO., LTD.
Report date: June 25, 2024
Company:SUZUKEN CO., LTD.
President:
Shigeru Asano, President and CEO
Inquiries:
Yuichi Yamamoto,Executive Officer,
Senior General Manager of Corporate Group Planning Headquarters, General Manager of Corporate Planning Dept.
+81 (52) 961-2331
Stock code: 9987
URL:
https://www.suzuken.co.jp/en/

Corporate governance at SUZUKEN CO., LTD. (“Suzuken” or “the Company”) is as follows:

I.

Basic Stance on Corporate Governance, Shareholder Composition, Corporate Data and Other Basic
Information

1. Basic Stance on Corporate Governance(1) Suzuken’s basic philosophy regarding corporate governance
The Suzuken Group positions the strengthening of corporate governance as an important theme of management. Moreover, throughefforts focused on strengthening our managerial systems, strengthening our risk management systems, and promoting disclosure andaccountability, we endeavor to increase stakeholder trust in our group and achieve our continued and sound development.
(2) Measures related to corporate governance and their implementation
1) Strengthening our management framework
Suzuken employs a system in which the Board of Directors is responsible for the oversight of management and decision-making, while
executive officers are responsible for conducting business operations. We have terminated the retirement benefit system for directors
and corporate auditors, reduced the number of directors, and established a compensation system linked to the company’s performanceand each individual’s contributions. In addition, at the conclusion of the 75th General Meeting of Shareholders held on June 25, 2021,
we transitioned to a company with an Audit and Supervisory Committee to further enhance the company’s corporate governance andstrengthen the supervisory and check functions of the Board of Directors.
For the management of subsidiaries, we supervise and audit the performance of executives and employees of subsidiaries. The
primary measures are sending directors and corporate auditors to subsidiaries, receiving reports and approving decisions as requiredby the related company management rules, and periodically auditing subsidiaries by using Suzuken’s Audit and Supervisory
Committee, Internal Audit Office and accounting auditor. Furthermore, each subsidiary has an internal control system and guidance
program that reflects the characteristics of its business operations.
2) Strengthening our risk management frameworka. Suzuken views compliance as one of the fundamental elements of business activities. Furthermore, we understand that protecting
our assets is necessary for meeting the expectations of all stakeholders. This is why we are dedicated to establishing, maintaining, andoperating an effective risk management framework.
The main organizational units involved in establishing this framework and their respective roles are as follows:• Board of Directors
The Board of Directors has the authority and responsibility to perform the overall supervision of risk management from a strategic
standpoint. In addition, the directors reach decisions about the appropriate allocation of resources and comprehensive risk
countermeasures to facilitate the seamless execution of corporate strategies.
• Officer in Charge of Risk Management
This officer supervises risk management for the entire Suzuken Group. Duties include oversight and instructions for the Risk
Management and Compliance Committee, Business Segment Risk Management Practices Committee, Risk Management andCompliance Practices Committee, Review and Supervisory Practices Committee for Sales Information Provision Activities,
Antimonopoly Act Compliance Expert Committee, Compliance Department, departments associated with risk management, andrisk management officers.
• Risk Management and Compliance Committee
This committee, which is supervised by the Board of Directors, determines risk management policies and goals to ensure that theSuzuken Group’s risk management is performed properly. The committee submits information and reports to the directors as
required.
• Business Segment Risk Management Practices Committee
This committee examines the measures from practical perspective and submits essential reports and proposals to the Risk
Management and Compliance Committee to manage risks of the Group segments in an effective and efficient manner.
• Risk Management and Compliance Practices Committee
Risk Management Practices Committee examines the measures from practical perspective and submits essential reports andproposals to the Risk Management and Compliance Committee to manage risks of the entire Group in an effective and efficientmanner.
• Review and Supervisory Practices Committee for Sales Information Provision Activities
Review and Supervisory Practices Committee for Sales Information Provision Activities effectively and efficiently reviews andsupervises the sales information provision activities of the Group. The Committee examines the challenges from practicalperspective and submits essential reports and proposals to the Risk Management and Compliance Committee for the purpose ofsubmitting necessary proposals based on regular reports provided by the Pharmaceutical Affairs Supervisory Office.
• Antimonopoly Act Compliance Expert Committee
Antimonopoly Act compliance is one of the top priority items in the governance of the Group’s distribution business segment.
Accordingly, the committee regularly evaluates the current state, examines and verifies the specific aspects of policies, andsubmits essential reports and proposals to the Risk Management and Compliance Committee.
• Compliance Department

This office, which is overseen directly by the president, oversees and manages all types of risk. The office coordinates riskrelated matters among managers, departments and subsidiaries. The office also performs centralized management formonitoring and analyzing the status of all types of risks for the entire organization and for proposing and implementing
countermeasures.
• Persons Responsible for Each Head Office Department (Risk Owners)
For primary risks, risk information is collected quickly by working with the Compliance Department and proposals and otheractions are taken to prevent specific problems from happening again.
• Risk Officers
Risk Officers are responsible for risk management at individual departments and subsidiaries. One role is communicating with
employees in their respective workplaces about items concerning risk management that were examined by a risk management
committee. Another role is performing risk management and educating employees about risk management.
b. The Suzuken Group has established the Corporate Ethics Hotline internal reporting system so that important information about
ethics can be received quickly. This hotline is designed to supplement the group’s systems for sincere compliance with laws andregulations at Suzuken and its subsidiaries.
3) Upgrading Disclosure and Accountability
Suzuken is taking actions to announce results of operations sooner and upgrade IR information provided through Suzuken Group
Integrated Report, the corporate website and other channels.
Furthermore, in addition to complying with disclosure regulations, we have voluntarily established an aggressive stance for timely
disclosure in order to make our operations more transparent. To upgrade accountability, we provide thorough explanations of ourmanagement policies and associated actions at shareholders meetings, information meetings for analysts and individuals, and otherevents. By providing this information, we aim to give people a better understanding of Suzuken and earn their trust.

Reasons for Non-Implementation of Principles of the Corporate Governance CodeSuzuken has implemented all of the principles of Japan’s Corporate Governance Code.

Disclosure Based on the Principles of the Corporate Governance CodeUpdated[Principle 1.3 Basic Capital Policy]
The Suzuken Group’s basic policy is to maintain stable dividends and to provide shareholder returns with a total payout ratio of at least
100% over the 3-year period average ending March 31, 2026, the final year of our medium-term management plan, “For your next
heartbeat— Creating a movement toward tomorrow.”
The objectives of the Suzuken Group are to enhance returns to shareholders and to improve corporate value and capital efficiency throughreinforcing existing business areas and making investment toward creation of new business.
[Principle 1.4 Cross-Shareholdings]
Suzuken’s basic policy on cross-shareholdings is to hold shares of companies that will help to increase its corporate value, as a means ofbuilding, maintaining, and strengthening transactional and collaborative relationships. The Board of Directors examines individual crossshareholdings to determine whether they are appropriate. Shares of companies that are deemed unlikely to increase corporate value are
sold, giving consideration to timing and so forth.
Regarding the reduction in cross-shareholdings, we announced a policy in May 2021 and are continuing to apply it in the medium-term
management plan, “For your next heartbeat— Creating a movement toward tomorrow.”[Efforts to Reduce Cross-shareholdings for the Improvement of Corporate Value in the Medium- to Long-Term]
In the current medium-term management plan, we have set a policy to reduce cross-shareholdings to 10% or less of consolidated net
assets by the end of the fiscal year ending March 31, 2025. As part of this effort, in the fiscal year ended March 31, 2024, we have reduced
approximately ¥9.2 billion across eight brands (including pharmaceutical companies and the Misonoza Theatrical Corporation), and we willcontinue to work toward this goal.
*Since the disclosure of this policy on May 2021, we have reduced a total of 25 brands (including partial sales), amounting to approximately¥22 billion.
As of March 31, 2024, the number of cross-shareholdings and corresponding amounts recorded on the balance sheet (based on the
securities report) are as follows:
For the fiscal year ended March 31, 2024:
・Unlisted stocks:
Number of brands: 30, amount recorded on the balance sheet: ¥4,284 million
・Stocks other than unlisted stocks: Number of brands: 39, amount recorded on the balance sheet: ¥58,245 million
In exercising its voting rights related to cross-shareholdings, the Company makes a comprehensive judgement based on whether or not the
proposal will lead to the increase of its corporate value in the medium-to long-term, and whether it will lead to shared benefit for theshareholders of the company concerned.
[Principle 1.7 Related Party Transactions]Suzuken has prohibited related party transactions with directors and corporate auditors in the “Regulations related to Directors andCorporate Auditors.” For related party transactions with major shareholders, we observe the procedures stipulated in the Companies Act
and require the transactions to be reported in the Board of Directors meetings in accordance with the Board of Directors Rules. Moreover,related party transactions are disclosed in accordance with the Companies Act, the Financial Instruments and Exchange Act, and otherapplicable laws and regulations.
[Supplementary Principle 2.4.1 Ensuring Diversity in the Appointment, etc., of Core Personnel]
The Suzuken Group has formulated an action plan based on the Act on the Promotion of Female Participation and Career Advancement in
the Workplace, and promoted participation by female employees. Through these efforts, three Suzuken Group companies, including
Suzuken, have been recognized by the Ministry of Health, Labour and Welfare for their exceptional efforts to promote the careers of
women, and have received the Eruboshi certification from the Ministry.
As of June 25, 2024, Suzuken and its Group companies have in total appointed seven female directors (including outside directors) andthree female executive officers.
Additionally, the Suzuken Group has been implementing various measures to increase the ratio of female employees in equivalent middle
managerial positions, aiming for 20% or more female managers by the fiscal year 2030.

In addition, Suzuken JoinUs Co., Ltd., which was established in December 2013 and certified as a “special subsidiary” in April 2015, isactively recruiting job seekers with disabilities, identifying the characteristics of each person, and working to expand and firmly establish
employment.
The Suzuken Group appoints employees based on the necessary experience and skills, irrespective of nationality and age. Therefore, wehave not established voluntary and measurable goals for appointing foreign nationals or mid-career hires to middle managerial positions.
[Principle 2.6 Roles of Corporate Pension Funds as Asset Owners]
The Company invests its corporate pension fund through the Suzuken Corporate Pension Fund, whose Board of Representatives
comprises selected members who possess the appropriate qualities for managing a corporate pension fund. Furthermore, an AssetManagement Committee monitors the status of management of the pension assets periodically in accordance with regulations to ensure
safe and efficient management of pension funds, as part of the Company’s efforts to establish an appropriate environment for managementof the pension funds.
[3.1 Full Disclosure](1) Company objectives (e.g., business principles), business strategies and business plans
The Suzuken Group’s Management Principles and Suzuken’s medium-term management plan are published on its corporate website.
Please refer to the following URLs.
(Suzuken Group’s Management Principles: https://www.suzuken.co.jp/en/company/philosophy.html)(Medium-term management plan: https://www.suzuken.co.jp/en/ir/strategy/)(2) Suzuken’s basic philosophy and basic policy regarding corporate governance
The Suzuken Group positions the strengthening of corporate governance as an important theme of management. Moreover, through efforts
focused on strengthening our managerial systems, strengthening our risk management systems, and promoting disclosure andaccountability, we endeavor to increase stakeholder trust in our group and achieve our continued and sound development
For details, please refer to section “I. 1. Basic Stance on Corporate Governance” in this report.
(3) Director compensation
With regard to compensation for directors (excluding the directors that are Audit and Supervisory Committee members), Suzuken has a
Nomination and Compensation Committee, of which the majority is comprised of outside directors, for the purpose of ensuring thetransparency and objectivity of nominations and compensation for directors.
Compensation for directors (excluding the directors that are Audit and Supervisory Committee members) is decided by the Board of
Directors following a comprehensive and objective study by the Nomination and Compensation Committee. This study involves acomprehensive performance evaluation for each director. This evaluation follows the Regulations for Evaluations of directors, executive
officers, and associate directors and the Regulations for Treatment of directors, executive officers, and associate directors and uses
company-wide performance indicators, along with the performance indicators of the business units a director oversees.
(4) Appointment, dismissal and nomination of directors
Suzuken has a Nomination and Compensation Committee, of which the majority is comprised of outside directors, for the purpose of
ensuring the transparency and objectivity of nominations and compensation for director candidates.
In nominating the candidate directors (excluding the directors that are Audit and Supervisory Committee members), the Nomination andCompensation Committee assesses the candidates and deliberates on nominations, and then the Board of Directors makes a resolution on
them. In nominating the candidate directors that are Audit and Supervisory Committee members, in accordance with the approval andrequest of the Audit and Supervisory Committee, the Nomination and Compensation Committee deliberates on nominations, and then the
Board of Directors makes a resolution on them.
For dismissals, the Company has an established policy and procedure in its Internal Rules for Corporate Officers.
(5) Explanation regarding individual appointments and, dismissals nominations
The individual career summaries of each of the directors for appointment, dismissal or nomination, as well as the reason for their
appointment or dismissal are provided in the notices of the General Meeting of Shareholders. Please refer to the following URL.
(Notice of the General Meeting of Shareholders: https://www.suzuken.co.jp/en/ir/stockinfo/generalmeeting.html)[Supplementary Principle 3.1.3 Enhancing Information Disclosure on Sustainability][Sustainability Initiatives]
The Suzuken Group fulfills its social infrastructure mission of pharmaceutical distribution while continuously creating new value by
combining the functions of its various businesses and collaborating companies in the field of health creation. In doing so, we are helping tobring about a sustainable society and enhancing our corporate value.
We have identified critical ESG themes, in light of our changing business environment and social trends.
Collaboration with stakeholders is indispensable for value creation, and we aim to resolve social issues while undertaking periodic reviews
through interactive communication.
For specific information, please refer to the Suzuken Group Integrated Report at the URL listed below.
(One Team Report 2023: https://www.suzuken.co.jp/en/ir/library/annual/)
In order to resolve social issues through business based on sustainable management, and to achieve sustainable growth for the Suzuken
Group through providing new value, Suzuken established the Sustainability Committee as an organization under the direct control of thepresident on April 1, 2022 and is constructing an implementation system that connects all Group companies centering on this Committee.
Information about sustainability initiatives is provided in the Securities Report (Japanese: https://www.suzuken.co.jp/ir/library/yuka/).
[Investment in Human Resources and Intellectual Property]
People are the most important business resource in the Suzuken Group. And as the environment surrounding our Group undergoes greatchanges at previously unimagined speeds, we feel the need to foster personnel with diverse ideas that can adapt to these changes in orderto achieve our goal of becoming a “health creation enterprise” which contributes to all elements of the patients’ healthcare lifecycle.
We will gather diverse human resources not only from the Group but also from our partner companies, becoming “One Team”. With ouraim to contribute to society through our business, we are carrying out human resource management which makes maximum use ofindividual growth and abilities in our business management.
For details, please refer to the Securities Report (Japanese: https://www.suzuken.co.jp/ir/library/yuka/).
[Supplementary Principle 4.1.1 Matters for Resolution by the Board of Directors and Scope of Delegation]

Suzuken has stipulated matters to be resolved and matters to be reported under the Board of Directors Rules and the Board of Directors
Detailed Rules, and has set out the Duties and Authority Rules to define the scope of delectation to the management team, including thedivision of work and position responsibilities and authority. It has also set out the criteria and procedures for making requests in the
Request Rules.
[4.9 Independence Standards and Qualification for Independent Outside Directors]
Suzuken selects independent outside directors who satisfy the criteria for outside directors set out in the Company’s Act and the criteria for
independence provided by securities exchanges. Suzuken gives overall consideration to their advanced expertise and insight, and theircontribution to decision-making from an objective and neutral perspective, and to performing supervision and oversight.
For details, please refer to “II.1 [Directors] and [Corporate Auditors]” in this report.
[Supplementary Principle 4.10.1 Nomination and Compensation Committee]
To discuss nomination and compensation for the directors, executive officers, associate directors, and trustees, the Company has
established the Nomination and Compensation Committee, comprising a total of five members, which consists of one representative
director, one internal director and three outside directors, who are appointed by the Board of Directors.
The majority of the committee members are comprised of outside directors, for the purpose of ensuring the transparency and objectivity of
the nomination and compensation. The chairperson of the committee is appointed by the Board of Directors from among the committee
members.
None of the outside directors has a personal, investment, business, or other vested interest in the Company, and none of the items given
by securities exchanges, in provisions regarding independent officers, as causes for concern regarding conflicts of interest with ordinary
shareholders, apply. Based on the assessment that they are highly independent from the Company, all of the outside directors have been
designated as independent directors.
[4.11.1 Approach to Balance, Diversity, and Size of the Board of Directors as a Whole]
Suzuken’s Board of Directors is composed of internal directors with a deep knowledge and experience of Suzuken’s businesses andoutside directors with high level specialist knowledge and insight. Members are selected without regard to gender, age, or other personal
characteristics, with a view to achieving diversity as well as an appropriate scale (the Articles of Incorporation stipulate no more than 14
members. Breakdown: No more than 9 directors (excluding the directors that are Audit and Supervisory Committee members), no morethan 5 directors that are Audit and Supervisory Committee members). With this balanced composition, the Board of Directors carries out
multifaceted decision making as well as supervision and oversight.
The skill matrix of each director is provided in the notices of the General Meeting of Shareholders. Please refer to the following URL.
(Notice of the General Meeting of Shareholders: https://www.suzuken.co.jp/en/ir/stockinfo/generalmeeting.html)[Supplementary Principle 4.11.2 Status of Concurrent Executive Positions Held by Directors at Other Listed Companies]
The status of concurrent positions held by directors is provided in the notices of the General Meeting of Shareholders. Please refer to thefollowing URL.
(Notice of the General Meeting of Shareholders: https://www.suzuken.co.jp/en/ir/stockinfo/generalmeeting.html)[Supplementary Principle 4.11.3 Overview of the Results of Board of Directors Evaluations]
Results of the evaluation of the effectiveness of Suzuken’s Board of Directors for the fiscal year that ended on March 31, 2024 are as
follows:(1) Summary
The Board of Directors is systematically linked with meeting bodies such as the Nomination and Compensation Committee, theManagement Meeting, the Management Planning Meeting and the Group Company Performance Reporting Meeting (hereinafterreferred to as “linked meeting bodies”), through which the Board enhances the governance of the entire Group.
Accordingly, the Company evaluates the effectiveness of its Board of Directors by confirming its systematic connections with thesemeeting bodies as illustrated in the Overview of Framework for Corporate Governance.
(2) Persons responsible for evaluation and entities to be evaluated
In order to secure neutrality and independence, five independent outside directors are responsible for evaluating the effectiveness of
the Board of Directors, with the Business Administration Department functioning as a secretariat.
With regard to the evaluation of the effectiveness of the Board of Directors, in addition to the activities of the Board of Directors itself,
the Company also monitors the activities of the linked meeting bodies.
Independent outside directors attend linked meeting bodies as much as possible throughout the business year. Those independent
outside directors who could not attend shall review agenda materials and minutes, or receive information from attending outside
directors or others. Based on these confirmation that the Board of Directors is systematically linked with these linked meeting bodies,
they monitor whether the Board of Directors is functioning effectively and whether corporate governance is functioning well across theGroup.
(3) Key items for confirmation
The evaluation of the effectiveness of the Board of Directors for the fiscal year that ended on March 31, 2024 was carried out based on
the following key confirmation items.
1) Confirmation of progress of new medium-term management plan2) Confirmation of the status of the governance system throughout the Group3) Ongoing confirmation of the legal compliance systems throughout the Group(4) Collation of evaluation results
After the end of each business year, the independent outside directors report and discuss the details monitored by each director andcollate evaluation results of the effectiveness of the Board of Directors for the said business year. The evaluation results collated
through these methods shall be submitted to the Board of Directors as agenda items, and confirmed and shared with the directors who
execute business operations.
These evaluation results shall be submitted to the Board of Directors and the Management Meeting, and shared and confirmed by all
directors and executive officers.
(5) Evaluation results of the effectiveness of the Board of Directors for the fiscal year ended March 31, 2024

The evaluation results of the effectiveness of the Board of Directors for the fiscal year that ended on March 31, 2024, which have been
confirmed through the above-mentioned process, are as follows:
1) The Board of Directors consists of five internal directors and five outside directors. To ensure the proper functioning of the board, theboard exchanges active and diverse opinions, including those of executive officers, primarily through in-person meetings as well as
online meetings.
2) The linked meeting bodies exchange active and diverse opinions primarily through in-person meetings, as well as online meetings,
to determine matters submitted by the Board of Directors for deliberation, confirm a PDCA cycle across the Group, and decide onother matters appropriately.
3) It has been recognized that the Board of Directors has restructured the Antimonopoly Act compliance system throughout the Groupand is endeavoring to prevent recurrence of the problem.
The Board of Directors will continue to carry out checks.
4) It has been recognized that the Board of Directors is continuously checking the status of development of the legal compliancesystem across the Group. The Board of Directors will continue to carry out checks to ensure that the legal compliance system is put
in place.
5) It has been recognized that the Board of Directors is effectively developing a governance system through the efficient operation of
the Board of Directors, the organization of the linked meeting bodies, and the enhancement of the Management Meeting.
6) It has been recognized that the Board of Directors is steadily promoting initiatives such as the establishment of new businesses
toward the Company’s third development phase, including the implementation of its medium-term management plan “For your next
heartbeat—Creating a movement toward tomorrow”.
7) It has been recognized that the Board of Directors has been appropriately monitoring the implementation of the Group’s medium- tolong-term management strategies in cooperation with the Management Meeting etc.
(6) Key items for confirmation in the fiscal year ending March 31, 2025
In light of the process for evaluation of the effectiveness of the Board of Directors for the fiscal year ended March 31, 2024, theevaluation for this fiscal year shall continue to be conducted based on the following key items for confirmation.
1) Confirmation of the progress of the medium-term management plan2) Confirmation of the status of governance system development throughout the Group3) Ongoing confirmation of the status of legal compliance systems throughout the Group[Supplementary Principle 4.14.2 Policy on Training of Directors]
Suzuken conducts training for newly appointed directors on risk and compliance. Furthermore, we also provide the necessary external
training, e-learning based internal training, and so forth, that is needed for them to adequately fulfill their roles and responsibilities.
[Principle 5.1 Policy for Constructive Dialogue with Shareholders](1) Basic stanceSuzuken is taking actions to announce results of operations sooner and upgrade IR information provided through Suzuken Group
Integrated Report, the corporate website and other channels. Furthermore, in addition to complying with disclosure regulations, we havevoluntarily established an aggressive stance toward conducting timely disclosure in order to make our operations more transparent.
(2) Structure
Suzuken has appointed an IR executive and has established the Corporate Communication Department and Corporate Planning
Department as IR departments.
(3) Dialogue
Suzuken holds earnings results presentations twice a year as well as visiting institutional investors. For details, please refer to “III. 2.
Investor Relations (IR) Activities” in this report.
*Furthermore, the Nomination and Compensation Committee was not established in accordance with any law or regulation.
[Initiatives for Achieving Management with a Focus on Cost of Capital and Stock Price] [English version available]
Suzuken has established a strategic policy to pursue management that is conscious of cost of capital and stock prices in order to achievesustainable growth and enhance long-term corporate value.
For more details, please refer to our company website.
･Notice Concerning the Formulation of Policy for Achieving Management with a Focus on Cost of Capital and Stock Price, and Revision ofMedium-term Management Plan and Shareholder Return Policy:
https://ssl4.eir-parts.net/doc/9987/announcement3/94164/00.pdf･Results briefing materials for the fiscal year ended March 31, 2024:
https://ssl4.eir-parts.net/doc/9987/ir_material_for_fiscal_ym10/155842/00.pdf[Status of Dialogue with Shareholders](1) Primary persons responsible for dialogue with shareholders
Disclosure manager (Senior General Manager of Corporate Group Planning Headquarters and General Manager of Corporate Planning
Dept.) and IR administrative liaison (General Manager of Business Administration Dept.)(2) Overview of the shareholders with whom dialogue was held
Institutional investors in Japan and overseas: 63 companies (total 98 meetings) *Results for the fiscal year 2023
Professional areas of persons engaging in dialogue: Analysts, fund managers, etc.
(3) Primary dialogue themes and matters of shareholder concern
Overview of financial results, medium-term management plan, returns to shareholders, growth strategy for each segment, etc.
(4) Status of feedback to the management team and the Board of Directors with regard to the shareholder opinions and concerns identifiedthrough dialogue
The department responsible prepares a summary of the dialogue and reports to the management team at the appropriate times. The
Board of Directors conducts meetings and other discussions according to the matter involved.

2. Shareholder Composition
Percentage of foreign shareholders

30% or more

[Principal Shareholders] Updated
Name

Number of shares Shareholding (%)

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

11,624,400

14.97

Custody Bank of Japan, Ltd. (Trust account)

3,525,900

4.54

NORTHERN TRUST CO.(AVFC) RE SILCHESTER INTERNATIONAL INVESTORSINTERNATIONAL VALUE EQUITY TRUST
Yoshiki Bessho

2,569,000

3.30

2,304,123

2.96

Chika Bessho

2,294,594

2.95

Hisayo Izawa

2,266,880

2.91

Masaki Bessho

2,265,678

2.91

Suzuken Group Employee Stock Ownership Association

1,900,000

2.44

Kyoko Suzuki

1,822,700

2.34

Suzuken Memorial Foundation

1,796,850

2.31

Has a controlling shareholder―

Has a parent company

None

Supplementary explanation Updated
The status of major shareholders represents the status as of March 31, 2024.

3. Corporate Data
Stock listings and markets

Prime Markets of the Tokyo and Nagoya Stock Exchanges, and the Sapporo Securities
Exchange

Fiscal year-end

March 31

Business type

Wholesale

Number of employees (Consolidated)

1,000 or more

Operating transactions (Consolidated)¥1,000 billion or more

Number of consolidated subsidiaries

10 to under 50

4. Policy Concerning Protection of Minority Interests When Transacting with Controlling Shareholder―

5. Other Special Circumstances That Could Materially Affect Corporate Governance Updated
Among our equity-method affiliated companies, Welby Inc. (hereinafter, “Welby”) and Pharmarise Holdings Corporation (hereinafter,“Pharmarise”) are listed on the Tokyo Stock Exchange.
The significance of the Company owning listed equity-method affiliated companies and the measures to ensure the effectiveness of thegovernance system are as follows:[A. The significance of owning listed equity-method affiliated companies]
1) Welby
Welby, a leading provider of PHR (Personal Health Record) services, engages in the planning, development, and operation of digital
therapeutic support services for patients across various disease areas. These services cover a wide range of areas, including lifestylediseases, oncology, central nervous system, autoimmune diseases, and rare diseases.
Since entering into a capital and business partnership with Welby in November 2019, we have been actively collaborating to promote theexpansion of “Welby My Carte” to medical institutions and to advance the integration with the Company's “COLLABO Portal”.
To further utilize the accumulated data and achieve more advanced system integration between the two companies, it is necessary tostrengthen the mutual relationship. Based on this belief, we acquired additional shares in November 2023, making the company an equitymethod affiliate of the Company.
Based on the idea of aiming to realize new value creation that solves social issues by combining real-world and digital resources, we willcontinue to promote the integration and joint development of the functions and know-how of both companies. Through this, we aim tocreate new value for pharmaceutical companies, medical institutions, pharmacies, and patients.
2) Pharmarise
Major pharmacy chain operator Pharmarise, in its medium-term management plan “LSG (Leading to Sustainable Growth)”, has set forth
the goal of building a sustainable growth foundation towards 2030 through the implementation of measures in line with “strengthening
initiatives to become a company chosen by investors”, “business development centered on dispensing businesses”, and “further
strengthening of management foundation”.
We acknowledge that the business environment in the medical and pharmaceutical industries, as well as pharmacies, is undergoingsignificant and rapid changes beyond our expectations. This includes the implementation of various measures to control medical
expenses, as well as the promotion of deregulation, entry from different industries, and advancements in digitalization.
The Company and Pharmarise have built a strong relationship over the years through our respective business activities. We believe that,in order to adapt to these changes in the environment, it is necessary for us to combine the functions and services of both companies in
the concept of a focus on functions, and to advance discussions and initiatives aimed at providing more convenient services and creating
new value. To actively pursue these initiatives, we recognize the need to utilize the knowledge and know-how that we have accumulated
so far, and enhance the trust relationship between the both companies. Therefore, in November 2023 we entered into a business allianceagreement including capital participation.
By combining the management resources and know-how of the Suzuken Group and Pharmarise HD, and integrating the strengths andfunctions of both, we aim to create new added value that solves social issues together.
[B. Measures to ensure the effectiveness of the governance system]
The Company’s two publicly listed equity-method affiliated companies, Welby and Pharmarise, were already listed at the time of theCompany’s investment. The investments were made to further enhance trust and increase the corporate value of both companies. We
respect the independence of Welby and Pharmarise and believe that it is desirable to enhance their individual corporate value throughproactive business development based on swift decision-making. Thus, the individual business strategies of Welby and Pharmarise areappropriately carried out by these companies on their own initiative.
In addition, the Company has dispatched one director to Welby. As the board of directors of Welby consists of eight members, including
three outside directors, we have determined that this will not interfere with Welby's management decisions or the protection of minority
shareholders.

II.

Management Organization and Other Corporate Governance Systems Concerning Management
Decision-Making, Execution and Supervision

1. Matters Concerning Organizational Form and Organizational Management
Organizational form

Company with an Audit and Supervisory Committee System[Directors]
Number of directors in Articles ofIncorporation

14

Term of office for directors in Articles ofIncorporation

1 yearChairperson of Board of Directors

President

Number of directors

10

Appointment of outside directors

Yes

Number of outside directors

5

Number of outside directors designatedas independent directors

5

Relationship to SUZUKEN CO., LTD. (1) Updated

Name

Association

Shunichi Samura

Other

Hideaki Nakagaki

Other

Takeshi Ogasawara

Other

Toshimichi Kondo

Certified public accountant

Ayako Shimizu

Attorneyab

Relationship to Suzuken (*)
c d e
f
g h
i

j

k

△

*Selection criteria regarding the relationship with the company:“○” shows each item currently or recently applicable to the said individual; “△” shows each item applicable in the past to the said individual;“●” shows each item currently or recently applicable to a close relative of the said individual; “▲” shows each item applicable in the past to aclose relative of the said individual.
a. Person who executes business of the company or a subsidiary
b. Person who executes business or a non-executive director of a parent companyc.
Person who executes business of a fellow subsidiaryd. Person/entity for which the company is a major client or a person who executes business for such person/entity
e. Major client of the company or a person who executes business for such clientf.
Consultant, accounting expert, or legal expert who receives large amounts of cash or other assets in addition to director/auditor
compensation from the company
g. Major shareholder of the company (in cases where the shareholder is a corporation, a person who executes business of thecorporation)h. Person who executes business for a client of the company (excluding persons categorized as any of d, e, or f above)i.
Person who executes business for another company holding cross-directorships/cross-auditorships with the company
j.
Person who executes business for an entity receiving contributions from the companyk.
OthersRelationship to SUZUKEN CO., LTD. (2)Name

Audit and
Supplementary
Supervisory Independent
information concerning
Committee
director
applicable items
memberToshimichi Kondo

Ayako Shimizu――

The Company designated Mr. Nakagaki as a director because
it is of the judgment that he is able to make decisions from an
objective and neutral perspective and that he is suitable toperform supervisory and oversight tasks based on his deep
knowledge and insight acquired through many years of service
in Ministry of Health, Labour and Welfare.
Regarding Mr. Nakagaki’s attributes as an independent
director, none of the items from the securities exchanges
concerning the possibility of a conflict of interest with ordinary
shareholders is applicable. Therefore, the Company believes
he has a high degree of independence and has designatedhim as an independent director.
This designation was made after prior consultation and with his
consent.

―

The Company designated Mr. Ogasawara as a director
because it is of the judgment that he is able to make decisions
from an objective and neutral perspective and that he issuitable to perform supervisory and oversight tasks based on
his deep knowledge and insight acquired through many yearsof service in corporate management mainly in the financial
industry.
Regarding Mr. Ogasawara’s attributes as an independent
director, none of the items from the securities exchanges
concerning the possibility of a conflict of interest with ordinary
shareholders is applicable. Therefore, the Company believes
he has a high degree of independence and has designatedhim as an independent director.
This designation was made after prior consultation and with his
consent.

Mr. Kondo waspreviously employed at
Marunouchi Audit
Corporation (nowDeloitte Touche
Tohmatsu).
However, he left theoffice (January 1985)
before its merger with
Tohmatsu and was not
involved in any audits of
Suzuken.

The Company designated Mr. Kondo as a director because it
is of the judgment that he is able to make decisions from an
objective and neutral perspective and that he is suitable toperform supervisory and oversight tasks based on his
expertise and insight as a certified public accountant and tax
accountant.
Regarding Mr. Kondo’s attributes as an independent director,
none of the items from the securities exchanges concerning
the possibility of a conflict of interest with ordinary
shareholders is applicable. Therefore, the Company believes
he has a high degree of independence and has designatedhim as an independent director.
This designation was made after prior consultation and with his
consent.

―

The Company designated Ms. Shimizu as a director because it
is of the judgment that she is able to make decisions from an
objective and neutral perspective and that she is suitable toperform supervisory and oversight tasks based on her
expertise and insight as an attorney.
Regarding Ms. Shimizu’s attributes as an independent director,
none of the items from the securities exchanges concerning
the possibility of a conflict of interest with ordinary
shareholders is applicable. Therefore, the Company believes
she has a high degree of independence and has designatedher as an independent director.
This designation was made after prior consultation and withher consent.



Hideaki Nakagaki







Reason for designation

The Company designated Mr. Samura as a director because it
is of the judgment that he is able to make decisions from an
objective and neutral perspective and that he is suitable toperform supervisory and oversight tasks based on his deep
knowledge and insight acquired through many years of service
in business management, mainly in the department store
industry.
Regarding Mr. Samura’s attributes as an independent director,
none of the items from the securities exchanges concerning
the possibility of a conflict of interest with ordinary
shareholders is applicable. Therefore, the Company believes
he has a high degree of independence and has designatedhim as an independent director.
This designation was made after prior consultation and with his
consent.

Shunichi Samura

TakeshiOgasawara

Updated[Audit and Supervisory Committee]
Committee composition and affiliation of the chairperson

Number of members

Standing members

Internal directors

4

1

1

Audit and Supervisory
Committee

Directors and employees to assist with the duties of the
Audit and Supervisory Committee

Committee
chairperson

Outside directors

3 Outside Director

Yes

Matters related to independence from the executive directors of employees and said directors
Suzuken has set up an Audit and Supervisory Committee secretariat to assist with the duties of the Audit and Supervisory Committee, andallocated a person (former internal corporate auditor) from the company with abundant practical experience in Suzuken’s businesses as fulltime head of the Audit and Supervisory Committee secretariat, to assist with the duties of the Audit and Supervisory Committee.
Changes in the head of the Audit and Supervisory Committee secretariat will be made with the approval of the Audit and Supervisory
Committee.

Cooperation between the Audit and Supervisory Committee, accounting auditor, and internal audit division
At the conclusion of the 75th General Meeting of Shareholders held on June 25, 2021, Suzuken transitioned to a company with an Audit andSupervisory Committee.
To facilitate interaction between the accounting auditor and the Audit and Supervisory Committee, there are four meetings each year at an
Audit and Supervisory Committee with the accounting auditor Deloitte Touche Tohmatsu. The accounting auditor submits audit and quarterly
review plans, interim audit progress reports, second-half audit progress reports, audit reports, and the independent auditor’s report. The Audit
and Supervisory Committee receives an explanation each time one of these documents is submitted, and there is a discussion about thesereports.
Furthermore, the Audit and Supervisory Committee uses mutual cooperation with the accounting auditor for the purpose of performing audits
efficiently and effectively. For example, Audit and Supervisory Committee members and the Audit and Supervisory Committee secretariat
accompany the accounting auditor on visits to Suzuken’s business sites and subsidiaries.
There is also collaboration between the Audit and Supervisory Committee and the Internal Audit Office (internal audit division). Audit andSupervisory Committee members and members of this office hold discussions about the proposed fiscal year audit plan and work together toperform audits efficiently. The Internal Audit Office submits regular audit reports to the Audit and Supervisory Committee. Using this mutualinteraction makes it possible to perform efficient and effective audits.

[Voluntary Committee]
Voluntary committee corresponding to anomination committee and acompensation committee

Yes

Establishment status of voluntary committee, membership composition, affiliation of the chairperson
Number ofmembers

Standing
members

Internal
directors

Outsidedirectors

Outsideexperts

Nomination andCompensation
Committee

5

0

2

3

0

0

Outsidedirector

Nomination andCompensation
Committee

5

0

2

3

0

0

Outsidedirectors

Name of committee
Voluntarycommittee
corresponding toa nominationcommittee
Voluntarycommittee
corresponding to
a compensationcommittee

UpdatedSupplementary explanation

Committee
chairperson

OthersUpdatedTo discuss nomination and compensation for the directors, executive officers, associate directors, and trustees, Suzuken has established theNomination and Compensation Committee comprising a total of five members, which consists of one representative director, one internal
director and three outside directors, who are appointed by the Board of Directors. The majority of the committee members are comprised ofoutside directors, for the purpose of ensuring the transparency and objectivity of the nomination and compensation. The chairperson of thecommittee is appointed by the Board of Directors from among the committee members.
*As of June 25, 2024
Chairperson
Shunichi Samura, Outside Director
Committee member Shigeru Asano, President and Chief Executive Officer
Committee member Hiromi Miyata, Director and Chairman

Committee member Takeshi Ogasawara, Outside Director, Audit and Supervisory Committee Member
Committee member Toshimichi Kondo, Outside Director, Audit and Supervisory Committee Member[Independent Directors and Corporate Auditors]
Number of independent directors

5

Other matters concerning independent directors
Suzuken designates as independent directors all outside directors who fulfill the requirements for this designation.

[Incentive System]
Initiatives to offer incentives to directors

Introduced results-linked remuneration system, others

Supplementary explanation regarding applicable item
The compensation system for directors (excluding directors that are Audit and Supervisory Committee members) has two divisions: 1) fixedcompensation and 2) compensation linked to the company’s performance. The Company has set a higher proportion of compensation linked
to the company’s performance, reflecting earnings results. With respect to the compensation system, all directors, except for outside directors
who only receive fixed compensation, are subject to the same system.
Regarding the compensation linked to the company’s performance, the Company has established “individual performance evaluation-based
compensation” determined based on performance targets, “ordinary profit-linked compensation” determined by multiplying consolidated
ordinary profit by a certain percentage as short-term incentives, and “restricted stock compensation” as a medium- to long-term incentive.
Directors who serve as members of the Audit and Supervisory Committee receive fixed compensation.
For performance-linked compensation indicators, the Company has set performance targets in two areas, i.e., “company-wide performance” and“performance of the business units a director oversees,” and uses a higher percentage of “company-wide performance” when evaluating theperformance of directors at a higher position. With respect to the target of “company-wide performance,” the Nomination and Compensation
Committee deliberates on items that can most effectively contribute to attaining the medium-term management plan, and then the Board of
Directors passes a resolution regarding this. The Company has set three target items for the “company-wide performance” for this business year:
consolidated market share of medical-use pharmaceuticals, consolidated sales and consolidated ordinary profit margin. Therefore, evaluations
are conducted based on the Company’s consolidated earnings forecast. With respect to the “performance of the business units a director
oversees,” the Company has set performance indicators depending on roles and responsibilities of each business unit.

Eligible persons for stock options

Supplementary explanation regarding applicable item―

[Disclosure Concerning Directors’ Remuneration]
Degree of disclosure

No disclosure of individual remuneration

Supplementary explanation regarding applicable item
Suzuken discloses the total amount of compensation for all directors.

Policy for setting remuneration
amounts and calculation method

Updated

Yes

Details of Policy for Setting Remuneration Amounts and Calculation Method
Total compensation for directors (including directors that are Audit and Supervisory Committee members) for the 78th fiscal year (from April
1, 2023 to March 31, 2024) was ¥411 million. Information about compensation for directors is provided in the Securities Report.

[Support System for Outside Directors]
Suzuken provides the following support in order to enable outside directors to perform their duties with greater effectiveness.
• Regarding the provision of information concerning items submitted for decisions to the Board of Directors, materials are supplied inadvance and, as necessary, there is a preliminary explanation by the department involved.
• Suzuken uses its internal communication systems to create an environment that gives directors, executive officers, associate directors,•trustees, and employees equal access to information.
Individuals are asked to attend important internal meetings as needed.

2. Matters Concerning Business Execution, Audit and Supervision, Nomination, Remuneration and Other Functions(Overview of Current Corporate Governance Structure) Updated(1) Directors and Board of Directors
The Board of Directors examines important matters and reaches decisions in accordance with laws and regulations, the Articles ofIncorporation, the Board of Directors Rules and other internal rules. The board also oversees the performance of the directors andexecutive officers.
The Board of Directors made decisions about matters prescribed by law and important matters concerning management.
Furthermore, by using reports from directors and executive officers, the directors conduct mutual supervision of the suitability andefficiency of how the directors perform their duties.
To ensure that directors’ decisions are proper and verify the legality and suitability of how they perform their duties, four Audit andSupervisory Committee members (three outside directors) attend all meetings of the Board of Directors. At board meetings, thesethree individuals express their opinions, and perform supervision and oversight from many perspectives.
(2) Audit and Supervisory Committee
The Audit and Supervisory Committee meets once each month, in principle, and holds other meetings as required.
Audit and Supervisory Committee members attend meetings of the Board of Directors and other important meetings. Attendance isbased on Audit and Supervisory Committee audit standards prescribed by the Audit and Supervisory Committee and the fiscal year
audit policy and audit plan. In addition, these members receive information about the performance of duties from directors, executive
officers, internal audit division and other units, and they also check documents concerning important decisions and otherdocuments. Furthermore, responsibilities include audits at the head office, major business sites and subsidiaries concerning
operations and assets and the proper establishment and operation of compliance, risk management and other internal control
systems. Reports are also received from subsidiaries as required.
In addition, to reinforce the monitoring function, Suzuken has appointed three outside directors as Audit and Supervisory Committee
members. These outside directors consist of an expert in law, an expert in accounting, and a person with experience in business
management. We have also appointed one internal director who has been involved in sales and marketing department work formany years and who has extensive knowledge and experience related to the operations of the Company.
(3) Internal audits
The Internal Audit Office, consisting of 8 members, performs internal audits. This office, which reports directly to the president,
audits business sites and subsidiaries in accordance with internal auditing regulations. Audits confirm that internal controls arefunctioning properly, with particular emphasis on compliance and risk controls.
Audits are performed based on an audit plan for each fiscal year that is created by the Internal Audit Office and approved by thepresident. Field audits and document audits are performed, and audit reports are submitted to the president. When the president
decides that an audit report shows improvements are needed, the Internal Audit Office submits an Improvement Directive to theapplicable department. The office then receives an Audit Improvement Status Report by monitoring the preparation andimplementation of an improvement plan.
(4) Nomination and Compensation Committee
To discuss nomination and compensation for the directors, executive officers, associate directors, and trustees, the Company has
established the Nomination and Compensation Committee comprising a total of five members, which consists of one representative
director, one internal director and three outside directors, who are appointed by the Board of Directors. The majority of thecommittee members are comprised of outside directors, for the purpose of ensuring the transparency and objectivity of thenomination and compensation. The chairperson of the committee is appointed by the Board of Directors from among the committee
members.
This committee was not established in accordance with any law or regulation.
(5) Accounting audits and audit compensation
Deloitte Touche Tohmatsu has been selected to perform accounting audits. Suzuken is provided by Deloitte Touche Tohmatsu withaccurate management information from a fair and impartial viewpoint. Furthermore, Suzuken has created an environment that is
conducive to performing effective audits. Names and other information concerning certified public accountants who performed thisaudit are shown below. In addition, these audits were assisted by 23 certified public accountants and 29 others.
<Name of certified public accountants who conduct audits and their auditing firm>
Continuous audit period:
34 years
Deloitte Touche Tohmatsu
Designated limited liability partner and managing partner: Makoto Nishimatsu
Deloitte Touche Tohmatsu
Designated limited liability partner and managing partner: Akinori Masumi
Deloitte Touche Tohmatsu
Designated limited liability partner and managing partner: Yoshihiro Ishihara
The following compensation was paid to Deloitte Touche Tohmatsu:
Compensation for audit and attestation services: ¥88 million(6) Liability limitation agreement
Liability limitation agreement with directors
After concluding the main agreement, if the directors (excluding executive directors) are held responsible as directors of Suzuken
pursuant to Article 423-1 of the Companies Act, Suzuken limits their liability in accordance with Article 427-1 of the Companies Act
and with Article 29 of the Articles of Incorporation. However, this provision may not apply in cases where the responsibility is due todeliberate intent or gross negligence of the director.
In such cases, the amount of damages owed by the director to Suzuken shall be limit of responsibility provided in Article 425-1 of
the Companies Act.
(Liability limitation agreement with corporate auditors (including persons who were corporate auditors) prior to the conclusion of the 75th

General Meeting of Shareholders)
At the conclusion of the 75th General Meeting of Shareholders held on June 25, 2021, the Company transitioned to the system of acompany with an Audit and Supervisory Committee. The “Transitional Measures in Relation to the Liability Limitation Agreementwith Corporate Auditors” in the supplementary provisions of the Articles of Incorporation are as follows.
In regard to the agreement to limit the compensation liability under Article 423, Paragraph 1 of the Companies Act in relation to theactions of corporate auditors (including persons who were corporate auditors) prior to the conclusion of the 75th General Meeting of
Shareholders, the liability will be limited as stipulated in Article 36 of the Articles of Incorporation prior to changes by resolution of
the said General Meeting of Shareholders.

3. Reason for Selecting Present Corporate Governance System
The Board of Directors meets once each month, in principle, in order to reach decisions with speed and efficiency. Every director has
extensive knowledge and experience concerning Suzuken’s operations. To ensure the legality and suitability of decisions and other actions,
there is a system of checks and balances based on adequate discussions by all directors. Additionally, Suzuken appoints outside directors
who are experienced in business management and possess advanced professional knowledge and insights, including an attorney, acertified public accountant, and an expert. Through objective and neutral decision-making, supervision, and monitoring, Suzuken is taking
steps to further strengthen and enhance our management system.
Furthermore, Suzuken is maintaining a framework of supervision and oversight through the Audit and Supervisory Committee.
The Audit and Supervisory Committee is composed of a total of four members: three outside directors consisting of an expert in law, an
expert in accounting, and a person with experience in business management, and one internal director who has been involved in Suzuken
sales and marketing department work for many years and who has extensive knowledge and experience related to the operations of theCompany.
The outside directors have no particular financial interest in Suzuken, and are all designated as independent directors.

III. Implementation of Initiatives Concerning Shareholders and Other Stakeholders
1. Measures to Ensure an Active Ordinary General Meeting of Shareholders and Smooth Exercise of Voting Rights
Remarks

Early notification of the Ordinary General
Meeting of Shareholders

Although companies are legally required to send shareholder meeting notices two weeks
in advance, Suzuken sends these notices three weeks before the meeting to give
shareholders sufficient time to consider the proposals that have been submitted. The
information contained in the shareholder meeting notices is also made available via theTimely Disclosure network (TDnet) and Suzuken’s corporate website.

Avoidance of busy dates when setting thedates for the Ordinary General Meeting of
Shareholders

Suzuken sets meeting dates so as to avoid busy dates.

Allows voting rights to be exercised via theinternet

For the convenience of shareholders, Suzuken has allowed shareholders to submit votes
using the Internet since the June 2006 shareholders meeting.

Participation in electronic voting platform andother measures to improve the environment
for exercising of voting rights by institutional
investors

To help create greater convenience for institutional investors, we have participated in an“electronic voting platform” for institutional investors since the general meeting ofshareholders held in June 2007.

Provision of English translations of thenotification of ordinary general meetings ofshareholders (summary)Suzuken provides English translations of the information in the notice of General Meetingof Shareholders for overseas institutional investors on TDnet and on our website.

Other

Rigorous accountability is the central element of Suzuken’s policy regarding shareholders
meetings. We view these meetings as the best opportunity for directly explaining ourpolicies, initiatives and business operations to shareholders. Explanations use visual
information shown on a large screen and other measures to give shareholders a better
understanding of Suzuken and earn their trust.

2. Investor Relations (IR) Activities
Remarks

Explanation bycompany
representative

Creation and announcement of a disclosure
policyThe Corporate Ethics Charter and Corporate Ethics Charter Guidelines
mandate the timely and appropriate disclosure of corporate information.

Holds regular investor meetings for individual
investors

Suzuken strengthened its IR activities by starting to hold information
meetings for individual investors in March 2007 for the purpose of raising No
awareness of the company among these investors.

Holds regular investor meetings for analysts
and institutional investors

Suzuken’s president explains the company’s strategies and operations
twice each year at the regularly scheduled information meetings foranalysts and institutional investors. Furthermore, Suzuken meets
individually with analysts and institutional investors.

Yes

Holds regular briefings for overseas investors

Suzuken participates in conferences for institutional investors held bysecurities companies.

Yes

Posts IR materials on Suzuken’s website

Suzuken provides information by issuing earnings announcements(kessan tanshin), data books, shareholder reports, Suzuken Group
Integrated Report and other disclosure materials.
https://www.suzuken.co.jp/en/
Video and audio of the president’s presentations at the analyst andinstitutional investor information meetings can be viewed on this website.

Established an IR office (officers)• IR departments: Corporate Communication Department and Corporate
Planning Department as part of Corporate Group Planning
Headquarters• IR executive: Executive Officer, Senior General Manager of Corporate
Group Planning Headquarters, General Manager of Corporate Planning
Department.
Yuichi Yamamoto• IR administrative liaison: General Manager of Business Administration
Department
Jun Naganawa

Other

Suzuken receives visits from investors from Japan and other countries toa prudent extent for the provision of additional explanations.

3. Measures Concerning Respect of the Standpoint of Stakeholders

Remarks

Prescribed respect for the standpoint of
stakeholders in internal regulations, etc.

Environmental protection and CSR activities

Formulated policy on the provision of
information to stakeholders

All executives, associate directors, trustees, and employees of Suzuken and its
subsidiaries are required to observe the Corporate Ethics Charter. The Charter covers
the company’s stance regarding corporate ethics; standards of conduct for executives,
associate directors, trustees, and employees and systems for following the standards;
and other subjects. Suzuken is using internal communication systems and othermeasures to ensure that everyone has an awareness and understanding of the Charter.
To implement the Corporate Ethics Charter, Suzuken distributes the Corporate Ethics
Charter Guidelines, which contain explanations of specific activities. Using this handbook
helps ensure the effectiveness of the Charter.
There are three primary units for ensuring the effectiveness of risk management at
Suzuken and the Suzuken Group: the Risk Management and Compliance Committee,
Business Segment Risk Management Practices Committee, Risk Management andCompliance Practices Committee and Compliance Department, which is overseen
directly by the president. We continue to take steps for further enhancing our ability to
manage and handle all risks at the Suzuken Group in an organized, structured and selfreliant manner.
Environmental protection activities are based on an environmental policy that was
created with the president’s direct supervision. In accordance with this policy, we arededicated to making constant improvements to our environmental management system
in order to lower our environmental impact. Examples of our initiatives include the use of
LED lighting that consumes less electricity and purchases of compact and hybrid
vehicles.
We have a rigorous information management system centered on the ComplianceDepartment for storing and protecting information, which is a valuable resource of the
Suzuken Group.
As part of our business continuity plan for preventing interruptions in operations following
a major disaster, we have a disaster response system and conduct regular drills to
confirm that our responses will be swift and accurate. As a company that is part of thesocial infrastructure, Suzuken has an obligation to supply the required pharmaceuticals at
the required time to the required locations. To accomplish this, we are building
cooperative relationships with medical institutions and other partners. Furthermore, weare constantly working on building a highly effective framework for fulfilling this obligation.
Regarding corporate citizenship, the Suzuki Memorial Foundation has the mission ofcontributing to scientific progress for the health of the people of Japan and to theimprovement of public welfare. The foundation supports studies and research concerning
applications in medicine for advances in the fields of medicine, pharmacology, medical
engineering and other sciences associated with health care.
With the support of the NHK Culture Centers in Nagoya, Tokyo and Osaka, Suzuken heldan event for students called the Suzuken Community Seminar – Looking Ahead to the
Spirit of Caring in the 21st Century.
To provide stakeholders with information about CSR activities, Suzuken issues a
Suzuken Group Integrated Report once each year. The report can be accessed on the
Suzuken website.
As one element of measures to make Suzuken’s operations highly transparent, theCorporate Ethics Charter Guidelines include specific instructions for the appropriate andtimely disclosure of corporate information. This demonstrates our firm commitment to theextensive and timely distribution of information.

IV. Internal Control System
1．Basic Stance Regarding Internal Control System and Status of Establishment
1. Suzuken’s Basic Philosophy Regarding Internal Control Systems
The Suzuken Group positions measures to strengthen corporate governance and CSR activities as one of its highest priorities. We
establish and implement internal control systems that are efficient and sound, and moreover are backed by constant evaluations andimprovements to achieve even higher quality. In addition, we are dedicated to the practical implementation of internal control systems
by means of making everyone aware of the policies and objectives of compliance and risk management.
(1) In accordance with the Company Law and its enforcement regulations, which were enacted in May 2006, the Board of Directors has
approved a Basic Policy for Building Internal Control Systems.
A description of the resolution approving this basic policy (revised on April 1, 2023) is provided in section 2. below.
(2) Internal controls concerning financial reports are overseen primarily by the Compliance Department, directly under the control of thepresident. This office establishes rules about internal controls, prepares manuals, and performs educational and other activities tomake employees aware of the rules to be implemented. Furthermore, this office works to conduct constant monitoring of the status ofinternal controls. This system ensures that the internal control assessments of senior executives will be reflected in the use of thesecontrols.
2. Basic Policy for Building Internal Control Systems(1) The purpose of internal controls is to ensure that directors and employees perform their duties in compliance with laws and regulations
and the Articles of Incorporation.
•
Soft 21, which consists of the Suzuken Group’s management philosophy and Suzuken’s management philosophy and code of
conduct, and the Corporate Ethics Charter are positioned as important standards of conduct. Through the internal communication
system, training, and other means, a strong sense of ethics will be fostered among directors, executive officers, associate
directors, trustees, and employees and strict compliance with laws and regulations will be maintained.
•
To ensure that directors perform their duties in a legal and appropriate manner, efforts are made to further strengthen the oversightsystem by increasing the use of outside directors who have wide-ranging knowledge and insight.
•
The Compliance Department, which performs internal audits under the direct supervision of the president, oversees theeffectiveness of controls involving the chain of command for business activities and performs constant monitoring concerning thelegality and suitability of how people perform their duties.
•
The Risk Management and Compliance Committee is established as a subordinate organization of the Board of Directors tomanage risks cross-organizationally and comprehensively. The Business Segment Risk Management Practices Committee and theSuzuken Risk Management and Compliance Practices Committee are established as subordinate organizations of the Risk
Management and Compliance Committee to implement effective and efficient risk management. The Review and Supervisory
Practices Committee for Sales Information Provision Activities, which provides effective reviews and supervisory functions for sales
information provision activities of the Group as a whole, and the Antimonopoly Act Compliance Expert Committee for the effective
and efficient implementation of risk management and compliance promotion policies specialized for the Antimonopoly Act are
established to offer continuous monitoring and maintain the soundness in duties executed by directors, executive officers,
associate directors, trustees, and employees at Suzuken and its subsidiary companies via the Corporate Ethics Hotline, which isan internal reporting system.
•
The Compliance Department, which is under the direct control of the president, supports and promotes internal controls related tofinancial reports and is responsible for conformity with the Financial Instruments and Exchange Law and associated laws. This
office also helps to prepare associated regulations and to establish optimal management systems by using IT and other means.
Moreover, the office ensures that internal controls are highly effective by providing employees and others with education andguidance about how to perform their duties properly.
(2) Systems for storing and managing information concerning the performance of duties by directors•
Information related to how the performance of duties and decision-making by directors is stored and managed as prescribed by theDocument Management Regulations and the Information Security Management Regulations. The executive officer for Corporate
Group Administrative Headquarters supervises and manages these operations.
•
The storage period for the above information is based on laws and regulations and the Document Safekeeping and Storage Period
Table.
(3) Regulations and other systems for managing the risk of a loss of information•
Information security management regulations, personal information protection regulations, disaster prevention management
regulations and other regulations are established based on the risk management regulations. A system for comprehensively andinclusively managing the risks at Suzuken and its subsidiaries (risks related to organizations, strategies, information management,
work management, compliance, business continuity, financial management, etc.) has been established and is being maintained
and operated.
•
For the effective functioning of risk management, a department responsible for each risk category is designated and performs
independent and constant monitoring of its risk category. Moreover, these departments closely cooperate with the ComplianceDepartment, which is a unit directly overseen by the president that performs centralized management of overall risk. This systemfacilitates activities for managing risk associated with business activities, preventing the occurrence of problems, and minimizing
any damage and preventing the spread of damage.
(4) System for ensuring that directors perform their duties efficiently•
Directors are responsible for management oversight and decision-making while executive officers are responsible for conducting
business operations. Duties and authority are clearly defined by the Rules for the Board of Directors and Internal Rules for
Executive Officers so that these individuals can perform their duties quickly and efficiently.
•
The Board of Directors formulates clear management plans and ensures that everyone at the company knows about the plan’s targets.
Executive officers in charge of business units devise and implement concrete, efficient measures for achieving these targets.
•
Based on reports by directors and executive officers overseeing business units at the Board of Directors meeting that is held oncea month, in principle, the directors oversee and confirm the status and suitability of how business operations are performed.
Directors constantly research and implement measures for increasing the certainty and efficiency of reaching targets.

•Efforts are made to improve the system for increasing the overall efficiency of business operations by utilizing internal
communication systems, IT technologies and other resources.

(5) System for ensuring the suitability of the business activities of the corporate group consisting of Suzuken and its subsidiaries•
For the management of Suzuken’s subsidiaries, managers at these companies report all important matters involving management
to Suzuken in accordance the Rules for the Management of Affiliated Companies. Furthermore, these companies must obtain
Suzuken’s approval for decisions related to these matters.
•
The Audit and Supervisory Committee, the Internal Audit Office and the accounting auditor audit Suzuken and its subsidiaries
periodically, in order to independently and objectively evaluate the status of management activities.
Moreover, if an audit reveals an item that needs to be improved, the audited department or subsidiary receives recommendations
and advice. Reports on progress concerning improvements are requested as necessary and other actions are taken to maintainthe effectiveness of internal control systems.
•
Suzuken’s Risk Management and Compliance Committee cooperates closely with the risk management departments at
subsidiaries to promote the building of effective risk management systems for the entire Suzuken Group.
•
Suzuken has a system in place where the management, finance, general affairs and various other aspects of Suzuken’s
subsidiaries are handled by the relevant divisions of Suzuken. Various matters related to business operation are also handled by
the relevant divisions of Suzuken. By maintaining close coordination between Suzuken and its subsidiaries, Suzuken ensures theefficient performance of duties by directors and other officers at its subsidiaries, and thereby facilitates efficient management.
•
Suzuken’s subsidiaries have positioned the management philosophies of the Suzuken Group and each subsidiary, along with the
Corporate Ethics Charter, as important standards of conduct. Through training and other programs, they will foster the ethicalawareness of directors, executive officers and employees in tandem with rigorously enforcing compliance with laws andregulations.
(6) Matters related to employees to assist with the duties of the Audit and Supervisory Committee•
The head of the secretariat of the Audit and Supervisory Committee acts as an employee to assist with the duties of the Audit andSupervisory Committee.
•
If the Audit and Supervisory Committee requests additional employees in order to perform their duties effectively, the directors(excluding directors that are Audit and Supervisory Committee members) will, as a rule, accept such requests and promptly provide
the necessary personnel.
(7) Matters related to the independence from the directors (excluding directors that are Audit and Supervisory Committee members) of
employees who assist the Audit and Supervisory Committee•
In accordance with the rules of the Audit and Supervisory Committee, personnel matters of the head of the Audit and Supervisory
Committee secretariat will be discussed with the Audit and Supervisory Committee.
•
In regard to the head of the Audit and Supervisory Committee secretariat and any other employees required to assist the Audit andSupervisory Committee to perform their duties, with respect to the range of their duties to assist the Audit and Supervisory
Committee, these employees will not accept instructions and orders from higher ranking managers in their respective departments
or from directors (excluding directors that are Audit and Supervisory Committee members).
(8) System for directors and employees to report to the Audit and Supervisory Committee, and other systems for reporting to the Audit andSupervisory Committee•
Directors, executive officers, associate directors, trustees, and employees report important matters to the Audit and Supervisory
Committee in a timely manner. Moreover, by attending management meetings, Risk Management and Compliance Committee
meetings and other important company meetings, the head of the Audit and Supervisory Committee secretariat will sequentiallyreport on important matters involving Suzuken and its subsidiaries.
•
The manager of the Internal Audit Office submits regular auditing reports to the Audit and Supervisory Committee, and performs
investigations when requested by the directors that are Audit and Supervisory Committee members.
•
Directors, executive officers, associate directors, trustees, and employees of Suzuken and its subsidiaries, in accordance with theInternal Reporting Rules, report to the Compliance Department, either directly or through the Corporate Ethics Hotline, on any
violation of the law or Articles of Incorporation. In addition, the Compliance Department reports information that it receives to the
Audit and Supervisory Committee as necessary.
(9) Other systems for ensuring that audits by the Audit and Supervisory Committee are performed effectively•
Directors (excluding directors that are Audit and Supervisory Committee members), executive officers, associate directors,
trustees, and employees promptly respond to requests from directors that are Audit and Supervisory Committee members forreports or other important documents. Moreover, in order to increase the effectiveness of the Audit and Supervisory Committee’s
auditing activities, efforts are made to ensure that directors that are Audit and Supervisory Committee members have opportunities
to regularly exchange opinions with directors (excluding directors that are Audit and Supervisory Committee members), theaccounting auditor, the Internal Audit Office, and others as well as opportunities to attend important company meetings.
•
Suzuken shall efficiently process any prepayments or reimbursements of costs incurred in the course of performing the duties(limited to the performance of duties of the Audit and Supervisory Committee) of directors that are Audit and Supervisory
Committee members, upon request by the directors that are Audit and Supervisory Committee members.
(10) Basic thinking about the elimination of anti-social forces and the status of related activities
Based on our awareness that a company is a public organ of society, and in accordance with highest ethical standards, Suzuken
has a strong commitment to fulfilling its social responsibilities. We are resolutely opposed to anti-social forces and groups thatthreaten public order and safety.
•
Our Corporate Ethics Charter and Corporate Ethics Charter Guidelines, which are important standards of conduct, define theproper attitude and specific measures for dealing with improper or illegal demands from anti-social forces and groups. Througheducation and training via internal communication systems and other channels, we make all directors, executive officers, associate
directors, and employees aware of how to deal with these demands.
•
The Risk Management and Compliance Committee, which includes the risk managers of subsidiaries, studies risks associated with
the Suzuken Group. This committee shares information about anti-social forces obtained from external specialized organizations
and other sources so that everyone can be alert.
•
The Human Resources and General Affairs Department is responsible for dealing with anti-social forces. This department
cooperates closely with the police, the Aichi Prefecture Council for Corporate Protection Measures and other externalorganizations.
•
To prevent any damages in the event that an anti-social element becomes a customer or shareholder and makes improper orillegal demands, we will endeavor to conduct appropriate corporate surveys and promptly collect information about anti-social
forces from specialized external organizations and other sources.

2. Basic Policies to Protect Against Entities and Individuals Engaged in Unlawful Activities and Status of
Establishment
As was explained in Suzuken’s “Basic Philosophy Concerning Internal Control Systems and Its Status, 2. Basic Policy for Building Internal
Control Systems, (10) Basic thinking about the elimination of anti-social forces and the status of activities,” Suzuken has a strong
commitment to fulfilling its social responsibilities based on the belief that a company is a public organ of society and in accordance withhighest ethical standards. We are resolutely opposed to anti-social forces and groups that threaten public order and safety.
(1) Our Corporate Ethics Charter and Corporate Ethics Charter Guidelines, which are important standards of conduct, define the proper
attitude and specific measures for dealing with improper or illegal demands from anti-social forces and groups. Through education andtraining via internal communication systems and other channels, we make all directors, executive officers, associate directors,
trustees, and employees aware of how to deal with these demands.
(2) The Risk Management and Compliance Committee, which includes the risk managers of subsidiaries, studies risks associated with the
Suzuken Group. This committee shares information about anti-social forces obtained from external specialized organizations and othersources so that everyone can be alert.
(3) The Human Resources and General Affairs Department is responsible for dealing with anti-social forces. This department cooperates
closely with the police, the Aichi Prefecture Council for Corporate Protection Measures and other external organizations.
(4) To prevent any damages in the event that an anti-social element becomes a customer or shareholder and makes improper or illegal
demands, we will endeavor to conduct appropriate corporate surveys and promptly collect information about anti-social forces from
specialized external organizations and other sources.

V.

Other

1. Matters Concerning Anti-takeover Measures
Matters concerning anti-takeovermeasures

None

Supplementary explanation regarding applicable item
The Suzuken Group believes that the most effective defensive measure is earning greater trust among stakeholders by increasing
corporate value through measures centered on strengthening compliance and corporate governance.
However, due to changes in the economic environment in recent years, companies must always be aware of the risk of an unexpected
hostile takeover that could be detrimental to corporate value. We will examine ways to establish a framework for responding with speed
and in a suitable manner to a takeover bid.

2. Other Matters Concerning the Corporate Governance Framework Updated
Obligations and issues involving corporate governance and CSR are becoming broader and more diverse. For example, companies needto preserve the social fairness of business activities from the standpoint of stakeholders, strengthen risk management and help protect theenvironment. By working closely together, Suzuken and its subsidiaries are constantly working on an effective framework for corporate
governance and CSR. We are determined to increase the satisfaction of stakeholders and become an even more trusted partner of our
stakeholders.
[Overview of Framework for Timely Disclosure]Suzuken’s internal framework for the timely disclosure of corporate information is as follows:(1) Internal framework for the disclosure of corporate information in the Suzuken GroupThe Suzuken Group’s Corporate Ethics Charter and Corporate Ethics Charter Guidelines mandate timely and appropriate disclosureof corporate information (see relevant section). We are committed to conducting timely and appropriate disclosure activities for matters
decided by the Board of Directors and information at our departments that is defined as important information by the Financial
Instruments and Exchange Law and securities exchange timely disclosure rules, information that we believe can influence investment
decisions, and other information.
The internal systems for the disclosure of financial information and other corporate information are as follows:•
Financial information
Financial information is prepared by the Business Administration Department. After examination by the senior general manager
who supervises the concerned business operations and the information disclosure manager, the information is submitted via
the representative director to the Board of Directors for approval. The Business Administration Department, Corporate
Communication Department are responsible for timely disclosure, and disclosure is made immediately after approval of thecorresponding resolution by the Board of Directors.
•
Non-financial corporate information
For non-financial corporate information, the decision about whether or not to disclose information is made following a discussion
by members of the Corporate Communication Department and Business Administration Department and the disclosure
manager. Information that comprises an important fact or facts which is subject to disclosure criteria in accordance with theTimely Disclosure Rules stipulated by the stock exchange is disclosed immediately after a resolution by the Board of Directors.
Even in the case that information is not subject to the above-mentioned Timely Disclosure Rules, if it can be judged that the
information is useful for investment decisions, in light of the timeliness and fairness, the disclosure manager discloses theinformation promptly after obtaining the approval of the representative director. A report is then submitted to the Board of
Directors.
Furthermore, for events involving but not originated by the Suzuken Group, information is disclosed promptly after a meeting
between the disclosure manager and representative director. A report is then submitted to the Board of Directors.
All of the above information is strictly managed in accordance with Suzuken’s Insider Trading Management Regulations.
In addition, information that is disclosed is promptly posted on the Suzuken website following the disclosure decision.
(2) Decisions about timely disclosure of information by Board of Directors
At Suzuken, the Board of Directors decides about all cases timely disclosure of information that is subject to disclosure criteria in
accordance with the Timely Disclosure Rules stipulated by the stock exchange.
Furthermore, even in the case that information is not subject to the above-mentioned Timely Disclosure Rules, the disclosure
manager discloses such information in an appropriate and timely manner after obtaining the approval of the representative director.
A report is then submitted to the Board of Directors.
Decisions reached by the Board of Directors are checked for validity, legality, and suitability by the Audit and Supervisory Committee
members.
The Audit and Supervisory Committee members, including an outside auditor who is an attorney, always attend meetings of theBoard of Directors and make statements at these meetings.
Suzuken has an internal system and business process monitoring system to ensure the reliability of financial and other information.
For the oversight of internal controls for internal organizational units, including subsidiaries, there are audits by the Audit andSupervisory Committee members as mandated by the Company Law. In addition, the Internal Audit Office performs audits of thestatus of business operations, and submits audit reports and proposals for improvements to the representative director.

Overview of Framework for Corporate Governance (as of January 1st, 2024)

Overview of Framework for Timely Disclosure

Corporasubject