Basic Information

Directors and Corporate Auditors (As of November 23, 2023)
The Ryohin Keikaku Group redefined its corporate purpose as creation of “a truthful and sustainable life for all” with the goal of
creating a better world 100 years from now. With that in mind, the Group has set two themes in developing its business: “to be a partof people’s daily necessities” and “to take root in local society.” In order to achieve these objectives, we will select directors andcorporate auditors who have the appropriate experience and knowledge and who will increase the diversity of the Board of Directors
and Board of Auditors. In doing so, we will promote candidates from inside the Company and bring in people from outside.
Ratio of Outside Directors
to All Directors

Ratio of Female Directors
to All Directors

5/8

62.5%

3/8

37.5%

Current position

Attendance atmeetings of the Boardof Directors(FY2023/8)

Masaaki Kanai

Chairman &Representative
Director

16/16(100％)

111,160 shares/ Mr. Kanai has been involved in management as a director for many years and has been
performing a central role in the expansion and growth of the Company and its business.
23 years, 6 months He is expected to continue contributing to the enhancement of corporate value.

Nobuo Domae

President &Representative
Director

16/16(100％)

86,200 shares/ Mr. Domae has extensive experience and broad knowledge as a management
executive at various companies, and is expected to continue playing a central role
4 years, 6 months in the Company’s “Second Founding.”

Satoshi Shimizu

Executive Vice
President &Director

16/16(100％)

Mr. Shimizu has extensive experience in the areas of products and stores, and is
6,600 shares/
expected to play a central role in the globalization that is part of the Company’s
8 years, 6 months “Second Founding.”

Masayoshi
Yagyu

Outside Director(Independent)

16/16(100％)Mr. Yagyu has extensive experience and broad insight as a corporate manager. He is
2,700 shares/
expected to function appropriately in his role as an outside director in areas such as
7 years, 6 months supervising business execution.

Atsushi
Yoshikawa

Outside Director(Independent)

16/16(100％)Mr. Yoshikawa is expected to draw on his extensive experience and broad insight as
4,000 shares/
a corporate manager to continue contributing as an outside director to the sustained
5 years, 6 months growth and increased corporate value of the Company.

Kumi Ito

Outside Director(Independent)

13/131(100％)

500 shares/
1 year

Ms. Ito has deep insight into management related to digital technology andhealthcare from her experience as an outside director at several companies. We
expect Ms. Ito to provide valuable suggestions and advice.

Yuriko Kato

Outside Director(Independent)

13/131(100％)

0 shares/
1 year

Ms. Kato is expected to give valuable suggestions and advice as she has expert
knowledge in agricultural and digital businesses. She also has deep insight into
corporate management based on her experience as an entrepreneur and as an
outside director at several companies.

MayukaYamazakiOutside Director(Independent)

13/131(100％)

0 shares/
1 yearMs. Yamazaki is expected to give valuable suggestions and advice from various pointsof view. She has experience at an international post-graduate business school and as
an outside director at several rapidly growing start-up companies. She is also wellversed in traditional culture and art as a practitioner of Japanese flower arrangement.

Kei Suzuki

Full-time
Corporate Auditor

16/16(100％)

39,300 shares/
2 years

Mr. Suzuki has served the Company as general manager of the Household Division, andas a director and executive officer he has held important positions in overseeing overseas
business management, the HR & General Affairs Division, legal affairs and intellectual
property, and the Internal Audit Office. Based on his deep insight into Ryohin Keikaku’s
business, we expect him to function appropriately as a full-time corporate auditor.

KosukeYamaneFull-time Outside
Corporate Auditor(Independent)

13/132(100％)

0 shares/
1 year

As a full-time outside corporate auditor, Mr. Yamane is expected to audit operations
based on his wide-ranging knowledge in the fields of accounting, finance, andinformation systems, based on his extensive experience in important positions
related to public relations, investor relations, finance and information strategy.

Jun Arai

OutsideCorporate Auditor(Independent)

15/16
(94％)

OutsideOutsideName

OutsideMaoko Kikuchi Corporate Auditor(Independent)ー3

Number of shares
owned/Numberof years in office

Reason for appointment

Mr. Arai has extensive experience as a manager at multiple companies and a wide
2,300 shares/
range of knowledge in accounting, finance, and corporate governance. He is
3 years, 6 months expected to function appropriately as an outside corporate auditor.

0 shares/
Newly appointed

Ms. Kikuchi has experience working at the Japan Fair Trade Commission and other public
institutions, and as a public prosecutor in the Ministry of Justice. She has also served as
an attorney both in Japan and overseas in areas including corporate legal affairs. She has
also held the positions of outside director and standing outside Audit & Supervisory Board
member, and is expected to function appropriately as an outside corporate auditor as she
can be expected to audit operations based on her wide-ranging knowledge.

1. For Kumi Ito, Yuriko Kato and Mayuka Yamazaki, the number of meetings held and attendance at Board of Directors meetings are after their appointment as directors on November 23, 2022.
2. For Kosuke Yamane, the number of meetings held and attendance at Board of Directors meetings are after his appointment as a corporate auditor on November 23, 2022.
3. Maoko Kikuchi was appointed at the General Meeting of Shareholders held on November 23, 2023.

63 MUJI REPORT 2023

Basic Information

Prerequisite

Competency
Overall corporate
management

The Board of Directors needs to make decisions after engaging in frank discussions of medium- to long-term strategies. We have therefore
selected diverse knowledge of corporate management that is not limited to a particular industry as a prerequisite.

Operations

Stores are central to our business, and effective operations and expansion are crucial to our competitiveness. We have therefore selected
knowledge about operations in the retail, distribution and manufacturing industries as a prerequisite.

Business entrepreneurshipand social entrepreneurship

We have selected knowledge about business entrepreneurship and social entrepreneurship as a prerequisite for achieving our corporate purpose.

Technology

We aim to create services that make good use of technology as a tool and to improve convenience for our stakeholders. We have therefore
selected knowledge about digital and technology management as a prerequisite.

International mindset

Achieving our corporate purpose requires us to contribute to various countries and regions around the world through store development andproduct manufacturing. We have therefore selected knowledge that includes experience in an international environment as a prerequisite.

Humanities and the arts

We have selected understanding of the culture and history of the countries and regions we serve and knowledge of the arts and design as
prerequisites for achieving our corporate purpose.

Sustainability and diversity

We position achieving sustainability and diversity at the core of our business activities in order to achieve our corporate purpose. We have therefore
selected an understanding of social issues such as sustainability and diversity and a strong desire to address those issues as prerequisites.

Administration and risk
management

We have selected knowledge of personnel and labor affairs, finance, legal affairs and risk management as a prerequisite for achieving our corporate
purpose.

Overallcorporate
management

Operations

Business
entrepreneurshipand social
entrepreneurship

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

Technology

International
mindsetHumanities Sustainability
and the arts and diversity

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

・Outside Director and Audit andSupervisory Committee Member,
Members Co., Ltd.

〇

◎

〇

〇

・President & Representative Director,
MUJI HOUSE Co., Ltd.
・Outside Director, Monex Group, Inc.
・Scholarship Director, CO-OP Sapporo

〇

◎

〇

・Outside Director, Chubu ElectricPower Grid Co., Inc.

〇

〇

◎

・Director and Member of Audit andSupervisory Committee, AssetManagement One Co., Ltd.

〇

〇

〇

〇

〇

〇

〇

〇

〇

・President & Representative Director,
M2 Labo. Inc.
・President & Representative Director,
Vegibus Inc.
・Outside Director, Shizuoka Gas Co., Ltd.

〇

〇

〇

〇

・Outside Director and Audit andSupervisory Committee Member,
M3, Inc.
・Outside Director, RENOVA Inc.

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

・Outside Director, SOMPO Holdings, Inc.
・Outside Director, Fuji Furukawa
Engineering & Construction Co., Ltd.
・Outside Director, True Data Inc.
・Executive Director, Tsukuba University
・Managing Partner, Office KITO GK〇〇

Concurrent positions

〇

〇

〇

Board ofAuditors〇〇〇

Nomination Remuneration
Advisory
Advisory
Committee
Committee〇〇〇

Meetings and Committees
Board ofDirectors〇〇〇

Administration
and riskmanagement

〇

〇

〇

◎

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

・Outside Director, Sumitomo Mitsui
DS Asset Management Company,
Limited〇・Outside Director, MITSUI-SOKO
HOLDINGS Co., Ltd.
・Outside Director, Hitachi Construction
Machinery Co., Ltd.
・Managing Partner, Compass
International Law Office

〇

〇

〇

〇

Notes: 1. The above does not encompass all of the experience and knowledge possessed by the officers. Only the major aspects are presented.
2. ◎ Indicates the chairperson of each meeting or committee.

MUJI REPORT 2023

64

Basic Information

Corporate Governance
Basic Policy
The creation of a highly transparent management system is a high priority based on our belief that establishing an effective management
structure and internal control system and improving corporate governance will lead to continuous improvement of corporate value. In
addition, we strive to maintain and develop good relationships with all stakeholders (shareholders, customers, employees, society, andpartner companies), and to proactively disclose information in a timely manner.

Corporate Governance System
General Meeting of Shareholders
Appointment & Dismissal

2

1

Board of Auditors

Board of Directors
Three insidedirectors

One inside corporate auditor
Audit

Three outside corporate
auditors (of which, one isa woman)AdviceCoordination

Five outside directors(of which, three are
women)

Coordination

Coordination

Nomination Advisory Committee

Five outside directors(of which, three are
women)

Two insidedirectors

Executive Advisory Committee

Advice4

3 Remuneration Advisory Committee
Audit

5
AdviceTwo insidedirectors

Five outside directors(of which, three are
women)

Appointment, Dismissal & Supervision

6

Coordination

Internal Audit Office

ReportChairman & Representative Director
President & Representative Director

Advisory Board

Accounting Auditor

Management Executive Meeting
ESG Management Committee
Business Process Standardization Committee
Executive Officers

Internal Audit
Accounting
Audit

Compliance and Risk Management Committee
Report7

Helpline
Consultation

Each Division and Group Company(As of November 23, 2023)

Activities During FY2023/8
１

Board of Directors

Number of meetings: 16
Attendance rate: 99%

2

Board of Auditors

Number of meetings: 17
Attendance rate: 99%

Objectives

Objectives

Makes statutory resolutions on important matters related to medium- tolong-term management, and matters stipulated by laws, regulations andthe Articles of Incorporation. Supervises the execution of duties by executive
directors and executive officers.

Audits the general execution of duties by directors from the perspectivesof legality and appropriateness. Prevents or corrects fraudulent acts, andviolations of laws, regulations, and the Articles of Incorporation.

Main Topics Discussed and Related Activities

In order to accurately understand the status of management, the Board ofAuditors participates in meetings of the Board of Directors and other important
meetings; interviews directors, executive officers, and managers of subsidiaries;
and conducts inspections of business sites. In addition, the Board of Auditors
cooperates with the accounting auditor and the Internal Audit Office tounderstand the status of business and internal control; holds regular meetings
with representative directors and outside directors; and raises issues andmakes recommendations regarding important Group-wide issues based on
the results of audits.

The Executive Advisory Committee, which is composed of members of
the Board of Directors, convenes regularly to discuss important themes
multiple times before making resolutions at Board of Directors meetings.
With respect to FY2023/8, agenda items discussed and resolved included
those related to the medium-term business plan, compliance and risk
reports, reports and assessments of ESG initiatives, the engagement
survey, and the headquarters relocation.

65 MUJI REPORT 2023

Main Topics Discussed and Related Activities

Basic Information

3

Remuneration Advisory
Committee

4

Number of meetings: 8
Attendance rate: 100%

Nomination Advisory
Committee

Number of meetings: 10
Attendance rate: 100%

Objectives

Objectives

Reports to the Board of Directors and the Board of Auditors regarding
issues including compensation for directors, auditors and executive officers.

Reports to the Board of Directors and Board of Auditors on issues including
the appointment and dismissal of directors, auditors and executive officers.

Main Topics Discussed and Related Activities

Main Topics Discussed and Related Activities

The committee held discussions on ESG evaluation for restricted stockcompensation, revision of the executive officer system, and other matters.

The committee held discussions on executive officer personnel, nominationof director and auditor candidates, and other matters.

5

Executive Advisory
Committee

This committee is composed of members of the Board of Directors, and is a forum for discussion and exchange of opinions
on medium- and long-term management strategies as well as a forum for ensuring adequate prior discussion of agenda items
at Board meetings.

6

Internal Audit Office

The Internal Audit Office, which currently comprises eight members, conducts internal audits. This office audits the status ofcompliance with internal rules and manuals at stores and headquarters, and the appropriateness and effectiveness of overallbusiness activities and procedures. Audit results are reported to the Board of Directors and the Board of Auditors.

7

Accounting Auditor

As for financial audits, we have created an environment that facilitates fair auditing with a team comprising two certified public
accountants (Mr. Hirotaka Nakata and Mr. Yosuke Sato), 11 certified public accountants who provide assistance, and 15 othermembers associated with KPMG AZSA LLC.

Transition to a Stronger Corporate Governance System
2002/2

2004/2…

2018/2

2019/2

2020/2
2020/8*2021/8Introduced outside director system
Institutional
Design2022/82023/8

Appointed a majority of outside directors

Remuneration Advisory Committee established
Nomination Advisory Committee established

Changed term of directors from two years to one year
Directors &Executive
Officers

Disclosed skills matrix
Introduced executive officer system

Changed contract type of executive officers from mandate contract to service contract
Elected a senior executive officer

Corporate
Governance
Report andAssessment of
Effectiveness

Issued Corporate Governance Report
Began assessment of effectiveness of Board of Directors (survey format)

Conducted interviews for assessment of Board’s effectiveness

Revised officer remuneration system (inside directors)
Officer
Remuneration

Introduced restricted stock compensation system
Increased ratio of performance-linked compensation* The Company changed its fiscal year end to August 31 as of the fiscal year ended August 31, 2020. For convenience, 2020/2 and 2020/8 are presented together in the above chart.

MUJI REPORT 2023

66

Assessment of Effectiveness of the Board of Directors
The Board of Directors conducted an analysis and assessment of the Board’s effectiveness based on the corporate governance policy set
by the Company. The results of that assessment are summarized below.
Summary of Assessment Process(1) The Board of Directors set the following evaluation categories it believes are necessary for assessment of the Board’s effectiveness and conducted a survey ofand interviews with directors and corporate auditors.
<Evaluation categories in the questionnaire>① Composition of the Board of Directors② Operation of the Board of Directors③ Enhancement of discussions at Board of Directors meetings④ System supporting the Board of Directors⑤ Enhancement of relationship with shareholders and other stakeholders⑥ Other comments(2) The Board secretariat summarized the results of its assessment of directors and corporate auditors based on the above questionnaire responses and interviews.
(3) Based on these results, the Board held discussions on each issue.
Results of the Assessment(1) Summary of scores<Average score for each category>
Assessment scores are set on a scale of 1 to 5, with “1” meaning improvement necessary, “3” meaning the minimum necessary level, and “5” meaning adequate.
① Composition of the Board of Directors (Average score: 4.4) (Previous assessment: 3.4)
② Operation of the Board of Directors (Average score: 3.4) (Previous assessment: 3.4)
③ Enhancement of discussions at Board of Directors meetings (Average score: 3.6) (Previous assessment: 3.6)
④ System supporting the Board of Directors (Average score: 3.7) (Previous assessment: 3.2)
⑤ Enhancement of relationship with shareholders and other stakeholders (Average score: 3.8) (Previous assessment: 3.5)
(2) Summary of assessment results
The results of the questionnaire and interviews above showed that the Board of Directors is evaluated as exceeding the minimum necessary level for the mostpart. While the diversity of the Board improved, we identified issues related to monitoring of execution and information sharing with outside directors.
Future Initiatives
Based on the issues identified through the effectiveness assessment of the Board of Directors, we will work on the following measures to further enhance theBoard’s effectiveness.
・Improving the monitoring function with thorough follow-up reports of the progress of medium-term business plan measures and other important matters・Having discussions regarding the next medium-term business plan with a view toward 2030 and 2040
・Enhancing information sharing with outside directors
・Expanding communication opportunities with stakeholders and enhancing disclosure

Policy for Appointment and Dismissal of Directors
Policy for Appointment of Officers
In nominating directors, the Nomination Advisory Committee, of which independent outside directors make up the majority, discusses eachcandidate’s qualifications, taking into consideration their previous experience, accomplishments, ability to execute tasks, and character, andreports its recommendations to the Board of Directors. In addition, when nominating outside director candidates, we select management
professionals who have experience, accomplishments, and knowledge in their respective fields. The nomination is discussed by the
Nomination Advisory Committee, taking into consideration the candidate’s ability to provide opinions and judgments that will contribute toenhancement of the Company’s medium- to long-term corporate value, and is then reported to the Board of Directors.

Number and Term of Directors
The Company’s Articles of Incorporation stipulate that the number of directors shall be no more than 11. For the term of directors, a proposal
to shorten the term from two years to one year was approved at the General Meeting of Shareholders held in November 2021, for the
purpose of clarifying the management responsibilities of directors and creating a management structure that enables us to respond quickly
to changes in the business environment.

Support and Training Policy for Outside Directors and Outside Corporate Auditors
Support System for Outside Directors and Outside Corporate Auditors
There is no specific person or division in charge of the support system for outside directors and outside corporate auditors, but the
Corporate Planning Division provides information, including distributing the agenda of Board of Directors meetings in advance, and theGeneral Affairs Division assists outside auditors in the execution of their duties.
In FY2022/8, we began holding executive sessions that involve informal interviews with executive officers in order to improveinformation sharing with outside directors. In addition, we have enhanced support for the smooth operation of the Board of Directors byintroducing a cloud-based Board management tool to improve the security of confidential information and enhance overall efficiency.

Training Policy
We encourage directors and corporate auditors to learn about matters such as the responsibilities, duties and legal risks of officers, and to workon self-improvement such as acquiring business knowledge of the operations they supervise. External training is also provided as necessary.

67 MUJI REPORT 2023

Basic Information

Executive Remuneration System
Policy for Determining Executive Remuneration
To enhance corporate value, remuneration of the Company’s directors consists of three types: payment of base compensation, which is a
fixed amount (according to the director’s position) within the total remuneration limits set by the General Meeting of Shareholders; paymentof performance-based bonuses as a short-term incentive linked to the Company’s performance; and non-monetary compensation as along-term incentive to continuously increase long-term corporate value and shareholder value.
Remuneration of outside directors and corporate auditors consists solely of base compensation, and there are no components thatfluctuate with performance. In addition, no executive retirement benefit system is available.
Compensation Structure and Components

Monetary compensation/
Base compensation

Summary

The base compensation of the Company’s directors is determined based on each director’s position, and by
the Board of Directors pursuant to the deliberations of the Remuneration Advisory Committee.

Monetary compensation/
Performance-based bonuses(Excluding outside directors and outside
corporate auditors)

Non-monetary compensation/
Restricted shares(Excluding outside directors and outside
corporate auditors)

The coefficient for determining bonuses is calculated (from the perspective of pursuing profit in core businesses)
by modifying the base bonus using the ratio of actual to planned consolidated operating profit. It ranges from
0% to 200%.
Non-monetary compensation is in the form of grants of restricted shares that vest upon retirement. Basegrants are determined in relation to achievements in areas such as ESG that have long-term significance, andvary from 30% to 100% according to director position.

Determination Process
Chaired by an outside director, the Remuneration Advisory Committee determines director compensation. The committee deliberates onmonetary and non-monetary compensation for each director individually, and is committed to transparency, validity and objectivity. Its
reports are referred to in Board resolutions. The Remuneration Advisory Committee consists of seven members, of which five are outside
directors. Having a majority of outside directors ensures thorough governance.

Ratio by Type of Compensation
The ratio of performance-linked compensation for directors of the Company increases the higher the position.
The ratio of base compensation, performance-based bonuses, and non-monetary compensation, etc., is shown in the table below
assuming 100% of the target is achieved.
In addition, short-term incentive performance-based bonuses range from 0% to 200%, depending on the level of achievement. The
percentage of long-term incentive non-monetary compensation varies from 30% to 100% depending on the level of target achievement.
Non-monetarycompensation

Monetary compensation

Representative Director

Base compensation 33.3%

Performance-based bonuses 33.3%

Restricted shares 33.3%
Non-monetarycompensation

Monetary compensation

Director

Base compensation 40%

Performance-based bonuses 40% Restricted shares 20%

Monetary compensation

Outside Director

Base compensation 100%

The amount for FY2023/8 is disclosed in the Securities Report (Japanese only). ▶https://ssl4.eir-parts.net/doc/7453/yuho_pdf/S100SBV6/00.pdf

About Cross-Shareholdings
Ryohin Keikaku’s policy is to sell cross-shareholdings in principle, and theBoard of Directors receives reports on the reduction of cross-shareholdings
every year.
In exercising voting rights of shares held as cross-shareholdings,
we vote appropriately after judging the pros and cons of each proposal.
We comprehensively examine factors such as whether the proposal
will contribute to enhancement of the investee company’s corporate
value, whether it will contribute to enhancement of the Ryohin Keikaku
Group’s sustainable growth and medium- to long-term corporate value,
and whether it conforms to the purpose of holding the shares.

Carrying value (Left scale)(Million JPY)

4,730

5,000
4,000
3,000

Number of stocks (Right scale)

3,791

3,792

5

5

(Stocks)

4,573

8
6
4

4

2,000
1,000
0

10

1,713
1

2020/2

2020/82021/82022/82023/84
20

MUJI REPORT 2023

68

Basic Information

Messages from Outside Officers

Masayoshi Yagyu
Outside Director

The Company has declared its “Second Founding,” announced the 2030 Vision and set out
key tasks for realizing related goals. This includes establishing a core product lineup andstrengthening the production and procurement system, as well as the creation of a corporate
culture of self motivation. These moves have helped to create a strong business foundation forachieving our goal of expanding the scope and scale of the supply chain in the growth
process, without changing Ryohin Keikaku’s concepts or failing to ensure efficient daily
operations. In the two years since the start of the “Second Founding,” the Company has
overcome difficulties and begun to see progress in various areas, such as improvement ofinternal systems and recruiting of external talent.
Regarding the Board of Directors, new members with diverse knowledge and experience
have been added. This has led to livelier, more multifaceted discussions, and we are steering
the Board toward addressing the challenges the Company faces. Among those challenges
are two infrastructure improvements that may hold the key to realizing its vision.
The first strategy involves strengthening procurement and production by fostering close
cooperation and continuous improvement with suppliers who understand and share Ryohin
Keikaku’s aspirations. This will include getting more deeply involved in production processes
in order to achieve these goals.
The second element is standardizing operations at headquarters and stores and developing
systems that will form the foundation of a corporate culture of self motivation. A true corporate
culture of self motivation that can support our business will not come from operations that depend
on tacit knowledge or a particular individual. Standardization and development of systems meansthat all associates will share the same approach in order to achieve the highest quality andefficiency. Individuality will not be lost as long as people involved in the process continue toimprove themselves. This standardization and development of systems are what will truly ensurethat people who are a part of a culture of self motivation are able to think and act freely.
As a member of the Board of Directors, I want to help build this foundation to help
realize the Company’s vision.

Atsushi Yoshikawa
Outside Director

69 MUJI REPORT 2023

Last year, I wrote that the challenge of the “Second Founding” was “at the point where thedrive wheels are very hard to move,” but I feel that those wheels have steadily begun gaining
traction in the past year.
The operating environment has improved significantly since the easing of the COVID-19
pandemic. Moreover, within the Company, the operating profit ratio improved through thesecond half of the period thanks to efforts to optimize inventory, aggressive control of logistics
costs, strengthening of the online sales environment, and other measures, combined with theintroduction of exciting new products and expansion of sales methods. Efforts to bolster
human resources, including from outside the Company, with a focus on headquarters staff,
generally proceeded as planned.
One issue is that even though the decision was made to raise prices in response to theexternal environment, the Company needs to further strengthen productivity in order toensure it can maintain fair prices. As for new store openings, the Company opened 75 storesin Japan and 65 stores overseas, but not all of these stores are growing their customer baseand sales as originally expected. The Company must continue to monitor its store opening
policy. The Company also needs to better manage business processes in Europe.
In the Remuneration Advisory Committee, we had extensive discussions on restricted
stock, a form of non-cash compensation. However, while there is definite progress toward theoriginal ESG-related targets, we do not think this movement is yet well established in the
Company, so we set the evaluation coefficient at 75%.
I will continue to oversee Ryohin Keikaku from a governance perspective as it continues
its “Second Founding.”

Basic Information

Kumi Ito
Outside Director

The past year has flown by since I joined team MUJI. I have worked in management at foreigncompanies and startups, and am currently active as an outside director at several companies
and as a director at a university, but I have never been contacted as much as I have since
being appointed an outside director of Ryohin Keikaku. That alone has made me keenly
aware of the appreciation and expectations people have for Ryohin Keikaku and MUJI, andthe weight of my responsibility.
Ryohin Keikaku, which has embarked on its “Second Founding,” has also changed thestructure of its Board of Directors, with three female outside directors joining the Board, myself
included. The environment here is conducive to a candid exchange of opinions. In addition tomeetings of the Board of Directors, the Nomination Advisory Committee and the Remuneration
Advisory Committee, I have various chances to talk with the other outside directors, senior
management, and people on the frontlines of business, including meetings with executive
officers and through store inspection tours. Everyone, myself included, enthusiastically shares
their views, and I often think, “Oh, I see what you mean!” during discussions.
On the other hand, I feel that there is a need to strengthen processes and systems tosuit a company of this size. Efforts such as IT improvements are already under way, and I would
like to keep an eye on their progress. I also think that the number of women in management
can be increased. Roughly 70% of new university graduate employees are women, so there
is a pipeline of candidates. Their continued professional development will be important.
All employees, from top executives to sales associates, are fans of MUJI and instinctively
understand what it should do for communities and people. As such, the corporate purpose isnaturally ingrained. As members of management, I believe it is important that we forge ahead
with strategies and action plans that give shape to people’s ideas.

Yuriko Kato
Outside Director

In the year since I was appointed, I think the biggest achievement is that management’s
thinking has changed dramatically. It takes conviction and strong management for a newleader to bring in fresh strategies and implement them. As an entrepreneur, I can assure youthat it is a whole lot easier to just build a new organization from scratch.
A year earlier, when I was first appointed, the atmosphere made it difficult for members ofmanagement, much less employees, to fully express themselves to President Domae, who is aclear-headed strategist. However, he humbly accepted the feedback of officers and employees,
and quickly sharpened his awareness and adjusted his behavior. He has enhanced open
management of meetings and increased opportunities for dialogue with employees, andcontinued working to really understand conditions on the frontlines. I feel that our cohesivenessas a team is improving.
I have also been very impressed by the managerial ability that allowed him to quickly
change business strategy while bouncing ideas off employees and the public under the difficult
circumstances of the “Second Founding” of a large company.
Recognizing that the MUJI concept and values were becoming forced, management
has begun building a system that respects the diversity of countries, regions and employees.
The Company is evolving into a creative group that fosters people’s well-being with a perspectivethat takes the entire planet into consideration. I am convinced that the challenge of taking
on a “Second Founding” will point the way to the manufacturing retailer business model ofthe future.

MUJI REPORT 2023

70

Mayuka Yamazaki
Outside Director

In the year since my association with Ryohin Keikaku began in autumn of 2022, I have seen
firsthand and in various settings how the Company is honestly trying to be a positive presence.
Amid a broad global trend of rethinking the emphasis on shareholder value and free-market
principles, and reexamining why companies exist (their purpose), more and more companies
are suddenly claiming to exist for society. But it is rare to find a company that has addressedthat question sincerely and conscientiously right from the beginning.
On the other hand, the past year has been one in which the people of Ryohin Keikaku
learned through trial and error how difficult it is for a company to try to be socially beneficial.
The definition of “beneficial” changes with the times. Organizations are now being required totransform their way of operating and doing business. There is no precedent to follow or correct
answer. Each person in the organization has to think for themselves, question things, andengage in dialogue with other members to move forward together. Based on survey results
showing that employee engagement is low, Ryohin Keikaku has recently shifted direction to apeople-centered policy that values members of the organization. I believe this will become theplatform for realizing Ryohin Keikaku’s intention of being a socially beneficial company.
Board of Directors meetings are a place where people with wonderfully varied backgrounds
and knowledge are able to frankly express their unique perspectives and opinions with a highdegree of psychological safety. In addition, outside directors are given ample opportunities todeepen their understanding of the Company and get feedback while maintaining their
independent viewpoints. This includes having opportunities to engage in dialogue with theexecutive team and direct communication with employees on the frontlines. I intend to findmore ways to contribute and give my wholehearted support to Ryohin Keikaku as it continues
to walk a path that no other company in the world can follow.

Message from an Outside Corporate Auditor

Kosuke Yamane
Full-time Outside Corporate Auditor

71 MUJI REPORT 2023

It has been a year since I was appointed as a full-time outside corporate auditor of Ryohin
Keikaku. I work hard to put my 40 years of experience at Komatsu Ltd. to use in the
Company’s growth. This is my first time working in the retail industry, but when it comes tomanufacturing, there are many elements that are the same. The engineering chain fromplanning and development to production and sales, the supply chain from material procurement
to delivery of products to customers, and the smooth flow of goods and information in thetwo chains are fundamental to strong manufacturing. We are currently insourcing someproduction work, and are in the process of getting more deeply involved in quality, cost anddelivery (QCD) operations at factories. The key to this is respecting and trusting suppliers as
business partners, and fostering a shared sense that we will grow together.
We are aiming to be a front runner in ESG management through our core business. The
use of natural materials and a recycling-oriented product lineup is our differentiation strategy,
and the goal is for all of our products and services to lead to a better environment and society.
The role played by outside officers in strengthening governance is substantial. I intend toenhance management transparency by offering different points of view that help stimulate
discussion in the Board of Directors and Board of Auditors.
I see the “Second Founding” as a way to reflect on the Company’s past to polish its
strengths and improve on areas of weaknesses. As an outside corporate auditor, I will do mybest to make the Company even stronger.

Basic Information

Risk Management and Compliance
Compliance and Risk Management Structure
Risk management is overseen by the Compliance and Risk

Board of Directors

Management Committee under the supervision of theReportingCompliance and Risk Management Committee
Personal information protection
Natural disaster risk
Domestic/overseas economic conditions
Human rights in supply chain, etc.
Reporting of individual risks

Each division

Domestic Group companies

Board of Directors. The committee, which is chaired by an
officer of the Company, meets regularly to gather informationon compliance and risks and to further discuss important
issues. Matters discussed by the Compliance and Risk
Management Committee are regularly reported to theBoard of Directors and are shared with directors andcorporate auditors.

Overseas Group companies

Business-Related Risks of Particular Significance
The Compliance and Risk Management Committee has prepared a risk management list to help each division recognize potential material
risks to the Group and to come up with ways to respond to them. The risk management list corresponds to Ryohin Keikaku’s operations
manual, ensuring that information on specific responses and measures is easily accessible. Each division regularly reviews risk-related
issues and updates the risk management list. In the review for FY2023/8, we increased the number of items in the risk management list
based on recent events and incidents, and are working on ways to respond to each item.
Material risks have been divided into three categories: compliance risks related to legal violations in the areas of occupational healthand safety and the supply chain; operational risks associated with information leaks and fraud; and financial and disclosure risks related totaxation and accounting. Ryohin Keikaku assesses potential material risks according to their significance and likelihood of manifestation.

Main Countermeasures Implemented in FY2023/8
Category

Compliance
Risks

Risk

Main Countermeasures

・Conduct ongoing monitoring of work schedules and overtime hours for store and headquarters
Occupational Healthemployees
・Assign dedicated safety management personnel to distribution centers to conduct on-site patrols,
and Safety
hold safety information sessions, and carry out risk assessments and hazard prediction training

Supply Chain
Operational
Risks

Information Leaks

Financial andDisclosure Risks

Taxation
Accounting

Fraud

・ Ensure the traceability of primary raw materials, conduct factory audits of key suppliers and disclose
list of suppliers・Establish information security and risk management teams to handle the protection of personal
information and to prevent external data breaches
・Create guidelines for payment and accounting process and ensure implementation
・Develop and manage framework to ensure thorough tax compliance, particularly as regards legal
requirements such as the new Japanese invoice system and transfer pricing taxation

Risk Management ▶https://www.ryohin-keikaku.jp/eng/sustainability/governance/risk/

Human Rights
Identifying and Assessing Possible Negative Impacts on Human Rights
In 2023, Ryohin Keikaku identified 22 human rights-related issues with the help of outside experts and by referencing international standards aswell as the results of factory audits and employee engagement surveys. We prioritized the issues identified by assessing their significance andlikelihood of impact on our operations and the supply chain, with reference to the United Nations Guiding Principles on Business and Human
Rights and the Organisation for Economic Co-operation and Development’s Due Diligence Guidance. We will formulate a roadmap for eachrelevant department and work with stakeholders to prevent and mitigate human rights risks. We will also regularly evaluate the effectiveness of
our initiatives, and continue to conduct reviews to identify and assess any negative impacts on human rights.

Priority Human Rights Issues
Company: H arassment (including harassment from customers); discrimination; gender rights; working hour management; and access to remedy
Supply Chain: Occupational health and safety; forced and child labor; discrimination; the environment; working hour management; genderrights; consumer safety and freedom of information; and harassment
Initiatives for Respecting Human Rights ▶Pages 45-46
Respecting Human Rights ▶https://www.ryohin-keikaku.jp/eng/sustainability/supply-chain/humanrights/

MUJI REPORT 2023

72

Quality
Ryohin Keikaku inspects each process of design, development, procurement and production based on the “Ryohin Standards,” and strives
to provide safe and secure products.
Approach to Quality ▶https://www.ryohin-keikaku.jp/eng/sustainability/activities/quality/

Initiatives for Quality Control
The “voices” (comments) of customers regarding our products are all registered in a dedicated database (“voice navigation system”), and theProduction Division, merchandising divisions and other related divisions cooperate and respond quickly in accordance with the content. By
enabling our business partners and factories to directly access the database to confirm the content, we have created an environment where
we can respond to quality problems quickly. In addition, the Production Division cooperates with external inspection organizations as needed.
The Production Division also leads weekly meetings to detect defects at an early stage as part of efforts to continuously improve quality.

Management Using the Restricted Substances List for Textile Products
During FY2023/8, we joined the Apparel and Footwear International RSL Management Group (AFIRM) as part of efforts to strengthen
management of chemical substances. AFIRM was established in 2004 by the Phylmar Group, a group of environmental, health and safety(EHS) and sustainability professionals. It is an international framework for managing the Restricted Substances List (RSL) in apparel andfootwear. We will eliminate chemical substances with potential effects on the human body, and strive for safe and reliable quality control.
For details ▶https://www.ryohin-keikaku.jp/eng/sustainability/environment/chemical/

Strengthening Food Safety Initiatives
Ryohin Keikaku has its own legally compliant standards called the “Ryohin Standards,” designates food additives for use and sets expiration
dates. We also select ingredients and devise processing and packaging methods to reduce the use of food additives.
Before launching a new product, we apply the “Ryohin Standards” to ensure rigorous quality control. This includes verifying whether productspecifications and content will safely maintain their integrity until the expiration date, and whether the cooking instructions are easy to understand.
In addition, we ensure that the food we provide through restaurants and ready-made meals also conforms to the “Ryohin Standards.”
In FY2023/8, we established the Food Safety Committee to reinforce the quality control system. We also conducted reviews of the“Ryohin Standards” and factory selection standards, and restructured the quality control and quality assurance system.
Responsibilities to Customers on Food ▶https://www.ryohin-keikaku.jp/eng/sustainability/activities/food/

Information Security and Protection of Personal Information
Ryohin Keikaku has formulated an Information Security Policy and a Privacy Policy to ensure it continues to earn the trust of its customers
and society by taking fundamental and sophisticated measures to protect the information assets entrusted to it by its customers and otherrelated parties, to maintain and improve its global corporate brand, and to comply with laws and regulations.
We strive to maintain and increase information security by complying with both policies, protecting information assets from various
threats, and handling them appropriately.
Information Security Policy ▶https://www.ryohin-keikaku.jp/eng/sustainability/governance/informationsecurity/
Privacy Policy ▶https://www.ryohin-keikaku.jp/eng/corporate/privacypolicy.html

Measures to Raise the Level of Information Security
In FY2023/8, we worked on creating systems compliant with the Information Security Management System (ISMS) and inaugurated theInformation Security Incident Response Team (MUJI-CSIRT). The goal of these measures is to establish a risk management system mainly
for the information security of the Ryohin Keikaku Group as a whole. To minimize risks, MUJI-CSIRT is charged with responding to andresolving cybersecurity incidents, making security improvements and conducting other related operations. Members responsible forpromoting initiatives are selected by each department to ensure a rapid and efficient response across all departments. We formally joined
the Nippon CSIRT Association in August 2023.

Management System
The Compliance and Risk Management Committee oversees information security for the Group as a whole. The committee has establishedthe IT Security Office and Personal Information Protection Office to accurately grasp the status of information security and to discuss andpromote countermeasures. The Personal Information Protection Office formulates rules and policies for personal information management
and manages the overall process. The IT Security Office builds, maintains and operates the IT infrastructure environment in compliance withrules and policies, and works for its continuous improvement. The IT Security Office reports on its activities to the Compliance and Risk
Management Committee, which meets four times a year, and the details of deliberations are reported to the Board of Directors at least twice

73 MUJI REPORT 2023

Basic Informationa year. In addition, each Group company appoints a person in charge of information security, and strives to strengthen and thoroughly
implement the information management system throughout the Group.

Board of Directors
President & Representative Director
Internal Audit Office
Responsible Executive
Executive Officer in charge of Overall Administration
Secretariat (Risk Management Division)

Compliance & Risk
Management Committee
Personal Information
Protection OfficeCountermeasure instruction/
monitoring

Responsible Executive
General Manager of the Risk
Management Division

IT Security OfficeGroupcompanies
ReportingResponsible Executive
General Manager of the IT
Services Division

MUJI-CSIRT
Each division

Information Security Training
We provide information security training to all officers and employees, andInformation Security e-Learning*

regularly conduct the following initiatives, which are effective for continuously
improving security literacy, assessing the level of understanding, and raisingawareness. By promoting awareness of security throughout our organization,
we aim to become a company that is resilient to cyber risks.
(1) C onduct an e-learning course on information security for all employees atleast twice a year
(2) Conduct training on targeted e-mail attacks for all employees twice a year(3) P rovide reminders prior to long vacations, and conduct awareness-raising
activities and follow-ups during daily work

Implemented

Training Theme

Participation
Rate

December
2022

Information security

80.5%

March
2023

Personal information
protection

77.5%

September
2023

Social media and stealthmarketing

87.0%* Ryohin Keikaku Co., Ltd. only

Compliance
Initiatives for Fostering Compliance Awareness
The Ryohin Keikaku Group Compliance Code of Conduct has been established to promote compliance with ethical standards and social
norms, laws and internal regulations through in-house training programs and awareness raising activities. Based on this code of conduct,anti-harassment training is conducted regularly for newly appointed managers to prevent harassment and improve management skills. In
FY2023/8, 450 employees participated in the training.
The Compliance and Risk Management Committee, which meets regularly, reviews the status of compliance with the Group
Compliance Code of Conduct, investigates any violations, identifies details and causes, and considers measures to prevent recurrence.
In addition, the Compliance and Risk Management Committee regularly verifies the effectiveness of the Group Compliance Code of
Conduct. No material compliance violations related to the business operations of the Group occurred in FY2023/8. The committee also
confirmed no political contributions were made. Fourteen other compliance violations occurred in FY2023/8. All Group companies were
notified of the incidents, and the importance of compliance was inculcated through in-house training and other measures.
Ryohin Keikaku Group Compliance Code of Conduct ▶https://www.ryohin-keikaku.jp/eng/sustainability/governance/compliance/

Internal Reporting System
We have established the Ryohin Keikaku Group Helpline to improve the effectiveness of the self-correction process, control reputationalrisks, ensure public trust and protect whistleblowers. The helpline prevents and detects legal violations, misconduct and harassment at an
early stage, and also adds to the compliance knowledge of officers and employees.
This helpline is available to all employees of Ryohin Keikaku and its domestic and overseas subsidiaries. This includes directors, employees(including contract employees, partner employees and part-time workers) and temporary employees. Anyone may make a report to thehelpline by telephone, email (including those using an anonymous system) or in person. Depending on the results of investigations, internal
procedures may be initiated as provided in the Rules of Employment, including the formulation of measures to prevent recurrence, theissuance of work orders and instructions, and disciplinary action and other personnel measures, as well as necessary external measures
such as press releases, media relations and criminal charges. A total of 184 requests for consultation were received in FY2023/8.

MUJI REPORT 2023

74

Basic Information

11-Year Summary
For more IR Information▶https://www.ryohin-keikaku.jp/eng/ir/

2013/2

2014/2

2015/2

2016/2

188,350

220,620

260,254

307,532(Domestic)—

171,923

182,701

198,449(Overseas)—

48,472

77,546109,080

Operating gross profit

87,376

101,665

122,831

150,451

Selling, general and administrative expenses

69,02480,74998,984116,012

Operating profit

18,351

20,916

23,84634,439

9.7

9.5

9.2

11.2

Ordinary profit

19,76023,047

26,60232,700Net income attributable to owners of parent

10,97017,096

16,623

21,718Cash flows from operating activities

13,17615,117

14,61926,133

Cash flows from investment activities(4,945)(17,842)(22,193)(8,647)

Cash flows from financing activities(2,540)(5,385)

11,377(6,520)Depreciation

3,186

4,179

4,887

6,816

Total assets

119,360

140,229

186,947

200,919

Net assets

96,050111,015

128,670

143,173Return on equity (ROE) (%)

12.5

17.0

14.3

16.4

Equity ratio (%)

78.3

76.9

67.0

69.4

Return on assets (ROA) (%)

17.8

17.8

16.3

16.9

Turnover of merchandise

—

3.73

3.10

2.89

Earnings per share (EPS) (JPY)

40.95

64.46

62.75

81.84

Net assets per share (BPS) (JPY)

Profit and Loss (Consolidated)
Operating income

Operating profit ratio (%)

Financial Position (Consolidated)

Key Performance Indicators(Included in consolidated key financial indicators)

Per-share Data

348.80407.19472.37524.79Dividends per share (JPY)

11.0

15.5

19.0

24.6

Dividend payout ratio (%)

26.9

24.0

30.3

30.1

Number of MUJI stores in Japan1

379

385

401

414

Number of MUJI stores overseas1

206

255

301

344

265,037

270,250

282,083

289,899

3,069

4,101

4,795

5,653

5,307

6,934

7,242

7,877

—

1,407

3,367

8,850

Other Data

Total sales floor space in Japan (m2)2
Number of regular employees
Number of non-regular employees

3

Downloads of MUJI passport app (thousand people)

4

1. Excluding Café&Meal MUJI and IDÉE
2. Total sales floor space of directly managed stores, licensed stores and Seiyu Co., Ltd.
3. Average number of employees per year based on an eight-hour workday calculation method
4. Registered members of external social media sites and various communication apps in Japan have been included from the fiscal year ended February 2019and from the fiscal year ended February 2020 for mainland China.
5. Due to the change in fiscal year, 2020/8 covers the six-month period from March 1 to August 31, 2020.
6. Number revised from MUJI REPORT 2022

75 MUJI REPORT 2023

Basic Information(Million JPY)

2017/2

2018/2

2019/2

2020/2

2020/852021/82022/82023/8333,281379,551

409,697438,713

179,392

453,689

496,171

581,412215,716

234,791

246,269

267,864

122,428

296,998

308,114342,829

117,563

144,758

163,425

170,846

56,961

156,691

188,057

238,583

165,861

191,819

211,380

217,628

83,694

222,334

234,356

271,549

127,583

146,532

166,636

181,248

82,821

179,887

201,582

238,41238,27845,28644,74336,380872

42,447

32,77333,137

11.5

11.9

10.9

8.3

0.5

9.4

6.6

5.7

38,582

45,98545,86136,377563

45,36937,21436,15625,831

30,11333,84523,253(16,917)33,90324,55822,052

19,742

46,982

23,68024,452(1,758)61,44723,35056,527(9,856)(14,290)(5,492)(31,435)(4,239)(13,538)(16,683)(22,106)(14,361)(21,759)(9,505)(11,467)

63,722(15,162)(58,647)(11,232)

7,543

8,644

9,867

17,622

10,35818,96922,01824,881

214,705

238,313258,309306,512

343,918

393,357

399,324

453,715

157,018

174,426

195,189

208,492

182,992

214,871244,852

267,446

17.7

18.6

18.8

11.8

(8.8)

17.3

10.8

8.7

71.3

71.3

73.8

66.6

52.4

53.9

60.5

58.1

18.6

20.3

18.4

12.8

0.2

12.3

9.4

8.5

2.55

2.55

2.44

2.28

1.87

2.19

2.22

2.36

97.50

114.70128.9288.47(64.32)128.90

93.24

83.51

579.18647.68725.83775.77684.94806.75915.93997.13

29.3

34.5

38.7

36.4

5.0

40.0

40.0

40.0

30.1

30.1

30.0

41.1

—

31.8

42.9

47.9

418

419

420

437

438

456

493

562

403

457

497

533

527

546

579

626

297,001

306,316

319,698

359,141

375,446

417,057

494,871628,133

6,992

8,128

9,137

9,615

9,046

8,882

9,175

10,074

9,203

9,254

8,050

9,281

9,834

10,721

12,28915,98349,38059,297

69,78078,527

10,233
6

21,128

10,825
6

44,746

6

MUJI REPORT 2023

76

Basic Information

ESG Data
2030 ESG Indices
Items

Key Performance Indicators

Initiatives in FY2022/8 (Figures Are as of August 31, 2022)

Initiatives in FY2023/8 (Figures Are as of August 31, 2023)

Percentage of packaging and materials forapparel, household goods and food productsthat do not use plastic (except when plastic
is required for hygiene, quality and safety)

Apparel: 74.8%
Household goods: 47.0%
Food products: Coffee beans, nuts and otheritems sold by weight at some stores

Apparel: 96.8%
Household goods: 64.7%
Food products: Recycled plastics and biomass
plastics used in some packaging

Total weight of plastic reduction (comparative
reduction of current versus previous plastic
packaging)

Apparel: 59ｔ
Household goods: U nder review
Food products: 251ｔ

Apparel: 104.8 t
Household goods: 60.7 t (Estimated reduction
resulting from the launch of refill
pouches for skin care products)
Food products: 292 t

Eliminate plastic inpackaging andvarious materials

100%

Design products forreuse and recycling

100%

Percentage of items designed with recycling
in mind (except when hygiene concerns
preclude recycling)

Household goods: 36.0%

Household goods: 52.1%

Reuse of plastic
products we collect100%

1. Total weight of collected plastic products
2. T otal weight of plastic collected for reuse(including products other than ours)

1.1,130 kg (PET bottles)
2. 1,130 kg

1. 2
 1,884 kg（PET bottles 2,298 kg, other plastic
products 19,591 kg）
2. 21,884 kg

Source socially andenvironmentally
responsible cotton1

100%

Percentage of socially and environmentally
responsible cotton used 2, 3

Apparel: 100%
Household goods: 87.4%

Apparel: 82.9%4
Household goods: 66.7%

Source animal-derived
materials from farms
practicing animal welfare 100%or using recycledmaterials

Percentage of materials sourced from farms
practicing animal welfare and use of recycled
animal-derived materials3

ApparelWool: 100％ certified non-mulesed wool
Down: 100% down certified to ensure animal welfare

ApparelWool: 99.9% certified non-mulesed wool
Down: 100% down certified to ensure animal welfareHousehold goods
Wool: 100% certified non-mulesed wool
Down: 100% down certified to ensure animal welfareHousehold goods
Wool: 100% certified non-mulesed wool
Down: 100% down certified to ensure animal welfare

Perform human rights
due diligence on
100％ 1. Number of audits conducted (annual)business partners,
disclosure 2. Breakdown of evaluation
traced back to raw
materials

Product manufacturers
1. 27 factories
2. A Assessment: 0 factories; B Assessment: 18
factories; C Assessment: 2 factories; D Assessment:
3 factories; E Assessment: 4 factories
The four E-rated factories indicated that they had
not formulated policies prohibiting child labor,
and that factory employees had to bear the costof medical examinations. We have agreed on
improvement plans for all of these factories andare confirming the implementation of improvements.

Product manufacturers
1. 73 factories
2. A Assessment: 2 factories; B Assessment: 36
factories; C Assessment: 18 factories; D Assessment:
8 factories; E Assessment: 9 factories
Material and raw material manufacturers
1. 43 factories
2. A Assessment: 2 factories; B Assessment: 30
factories; C Assessment: 3 factories; D Assessment:
5 factories; E Assessment: 3 factories

Material and raw material manufacturers
We started conducting audits of major material
manufacturers from FY2023/8. (We have alreadyconducted some due diligence. No significant
violations of law or Ryohin Keikaku’s Code of
Conduct were found.)Non-compliant items of E assessment factories
included locked emergency exits, unsatisfactory safetymeasures due to fire extinguishers and evacuationroutes being blocked by objects, and inadequate
management of working hours. We have agreed on
improvement plans for all of these factories and are
confirming the implementation of improvements.

List of major suppliers,
100％
List of major suppliers
traced back to raw
disclosurematerials

We began preparing to disclose a list of major
suppliers.

In March 2023, we disclosed the list of major factories
that produce MUJI apparel and textile products.
We are strengthening cooperation with our production
partners to expand the scope of disclosure, andare working toward disclosure of a list of major
factories and material and ingredient manufacturers
for household goods and food products.
List of Production Partners ▶https://www.
ryohin-keikaku.jp/eng/sustainability/supply-chain/partners/

Reduce Group GHG
emissions(Scope 1 and 2)

Total in Japan: 35,819 t-CO2e
16.1% increase compared with baseline year
Group total: 65,577 t-CO2e
10.8% increase compared with baseline year

Total in Japan: 40,378 t-CO2e
30.9% increase compared with baseline year
Group total: Under review
Increase compared with baseline year: Under review

50%
reduction

Scope 1 and 2 total (t-CO2e）
Baseline: 2021/8

100%

Number of stores and distribution centersthat use renewable energy (including
headquarters and campsites)

Equip stores (independent
store buildings) with100%
rooftop solar panels

Number of stores and distribution centerswith solar power generation equipment(excluding stores that cannot install solar
panels such as those in shopping malls)

We made plans to install and begin operation atseveral stores.

Demonstrate commitment todiversity and inclusion by
disclosing workforce compositionby age, gender and race

1. Average age (regular employees)
2. R atio of female regular employees inmanagerial positions (deputy manager
level and above)5
3. Ratio of female employees (regular employees)
4. Ratio of non-Japanese employees (regular
employees)
5. R atio of employees with disabilities(including non-regular employees)

1. 38.3 (Female: 36.9; Male: 40.0)
2. 20.7%
3. 55.6%
4. 1.3%5. 3.69%
Initiatives: Diversity Committee established

Ensure stores use
renewable energy

Installed in some stores and distribution centers
CO2 emissions were reduced by 1,322 t-CO2
through the introduction of renewable energy.

Installed in some stores and distribution centers
CO2 emissions were reduced by 1,578 t-CO2(including due to use of solar power)
We plan to begin using renewable energy with afocus on roadside stores.
Installed and began operation at 7 stores
CO2 emissions were reduced by 148 t-CO2

1. 38.4 (Female: 37.2; Male: 39.9)
2. 27.8%
3. 54.8%
4. 1.5%5. 3.23%

1. Starting in FY2023/8, we changed our target to “Source 100% socially and environmentally responsible cotton by 2030.”
2. Cotton that we have evaluated as socially and environmentally responsible includes GOTS, CmiA and GRS. We will be adding new indexes as appropriate.
3. Figures for the relevant fiscal year are based on materials used for products sold in the spring/summer and fall/winter seasons of each year.
4. A
 s a result of efforts to minimize the impact of COVID-19 on the supply chain and to promote stable sourcing of cotton, the percentage of organic cotton used decreased. Going forward, we willcontinue to increase our options in terms of socially and environmentally responsible cotton, not limited to organic cotton, to ensure stable sourcing.

77 MUJI REPORT 2023

Basic Information

Scope: Ryohin Keikaku Co., Ltd.
(As of August 31, 2023)

ESG Data
Items

Unit

Energy used

Environment

Renewable energy

Greenhouse gas emissions

Water
Waste generated

MWh

5,002

5,314

LP gas

MWh

213

333

Kerosene

MWh

331

332

Diesel fuel

MWh

18

17

Gasoline

MWh

52

36

Heat, steam and coolingMWh24,757

20,791

Electricity

MWh75,56087,684

Total

MWh105,933

114,507

Amount used

MWh

3,054

3,636

Ratio of renewable energy toenergy used

%

4.0

4.1

Scope 1

t-CO2e

1,110

1,187

Scope 2 (Market based)

t-CO2e34,70939,191

Scope 3t-CO2e1,059,355

1,198,241

Total

t-CO2e1,095,174

1,232,784

Hydrofluorocarbon (HFCs)

t-CO2e64

63

Water usagem3

147,783

144,429

Wastewaterm3

147,783

144,429

General wastet

12,25912,299Industrial waste

t

1,103

1,531

9,960

10,648

Female(%)

1,404 (55.6)

1,576 (54.8)

Male

(%)

1,123 (44.4)

1,298 (45.2)

2,527

2,874

Total
Number of non-regular employees
Managers (deputy manager level and above)5Society

Average age (regular employees)

7,433

7,774

Female(%)

36 (20.7)131 (27.8)

Male

(%)

138 (79.3)

340 (72.2)

Total

174

471

Female

36.9

37.2

Male

40.0

39.9

Total

38.3

38.4

(%)

7.8

7.9

(%)

9.4

8.8

FemaleAverage length of service (regular employees) Male
Total

8.5

8.3

5,930

6,202

Number of new university graduate hires

103

142

Number of mid-career hires

105

224

Average annual salary (regular employees)

Thousand JPY

Ratio of mid-career hires to total new hires

%

50.5

61.2

Voluntary turnover rate (regular employees)

%

8.25

7.34

Ratio of employees with disabilities

%

3.69

3.23

Female(%)

3 (37.5)

3 (37.5)

Male

(%)

5 (62.5)5 (62.5)

Directors

Total
Average number of years in office

Governance7

8

5 years, 7 months

6 years, 7 months

5

5

62.5

62.5

Times

16

16

%

99

99

Ryohin Keikaku Group Helpline
consultations

148

184

Number of employees participating inharassment training

206

450

Board of Directors

Number of outside directors

8%Outside directors

Compliance

FY2023/8

City gas

Number of employees
Number of regular employees

FY2022/8 6

Percentage of outside directors
Number of meetings
Average attendance rate

5. U
 ntil FY2022/8, only employees with executive titles such as “deputy manager” or “general manager” were considered managers. As of FY2023/8, employees whose job description and level of
responsibility are equivalent to that of “deputy manager” are also counted as managers, regardless of their job title or number of people in their team.
6. Some environmental data for FY2022/8 has been revised from MUJI REPORT 2022.
7. Figures are calculated based on the composition of officers after the annual shareholders’ meetings held on November 23, 2022 and November 23, 2023, respectively.
ESG Data Book ▶https://www.ryohin-keikaku.jp/eng/sustainability/muji-sustainability/number/

MUJI REPORT 2023

78

Basic Information

Stock Information (As of August 31, 2023)
Stock Overview
Total number of authorized shares: 1,123,120,000
Total number of issued shares: 280,780,000 shares
Number of shareholders: 157,917
Stock exchange listing: Tokyo Stock Exchange
Accounts settlement date: August 31
Ordinary General Meeting of Shareholders: Held in November each year
Administrator of the shareholder register: Sumitomo Mitsui Trust Bank, Limited

Distribution of Shareholders andNumber of Shares Held
Financial institutions: 94,700,247 shares
Securities companies: 20,197,755 shares
Other corporations in Japan: 20,874,219 shares
Corporations and individuals outside Japan: 86,168,479 shares
Individuals and others: 54,251,909 shares
Treasury shares: 4,587,391 shares

280,780,000
sharesCredit Rating Information
Long-term issuer rating: A+
Rating outlook: Stable
Rating agency: Japan Credit Rating Agency (JCR)

Major Shareholders (Top 10)
Shares Held (Thousands)

Shareholding Ratio (%)

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

Shareholder

41,416

14.99

Custody Bank of Japan, Ltd. (Trust Account)

25,108

9.09

Custody Bank of Japan, Ltd. (Trust Account E)

11,2244.06

Mitsubishi Corporation

10,783

3.90

Japan Securities Finance Co., Ltd.

7,763

2.81

MSIP CLIENT SECURITIES

6,478

2.34

SMBC Nikko Securities Inc.

5,895

2.13

BNP PARIBAS ARBITRAGE SNC

5,791

2.09

Mitsubishi UFJ Morgan Stanley Securities Co., Ltd.

5,441

1.97

JP Morgan Securities Japan Co., Ltd.

4,614

1.67

Notes: 1. T he Company holds 4,587,391 shares of treasury stock, which are excluded from the list of major shareholders above. The 4,587,391 shares of treasury
stock do not include 11,224,047 shares held by Mizuho Trust & Banking Co., Ltd. and 342,500 shares held by Sumitomo Mitsui Trust Bank, Limited for astock benefit trust (J-ESOP) and 267,700 shares held by Nomura Trust & Banking Co., Ltd. for an employee shareholding incentive plan (E-SHIP).
2. The 11,224,047 shares held by the Custody Bank of Japan, Ltd. (Trust Account E) are for the purpose of a stock benefit trust (J-ESOP).
3. The shareholding ratio is calculated after deducting the 4,587,391 shares of treasury stock.

Dividend Payout Ratio
2017/2

Consolidated dividend payout ratio

30.1%

2018/2

30.1%

2019/2

2020/2

30.0%

41.1%

2020/82021/8—31.8%2022/842.9%2023/847.9%

Stock Price and Volume
(JPY)

5,000

Stock price (Left scale)(Thousand shares)

Volume (Right scale)

250,000

4,000

200,000

3,000

150,000

2,000

100,000

1,000

50,0000
2013/2

2014/2

2015/2

2016/2

2017/2

2018/2

2019/2

2020/2 2020/8

2021/82022/82023/80

The Company conducted a 10-for-1 share split of its common shares on September 1, 2019. The stock price and trading volume are calculated assuming that theshare split was conducted at the beginning of FY2011/2.

79 MUJI REPORT 2023

Basic Information

Corporate Information (As of August 31, 2023)
Company Name
Address

Ryohin Keikaku Co., Ltd.
4-26-3 Higashi-Ikebukuro, Toshima-ku, Tokyo, 170-8424
Note: Headquarters was relocated in February 2024.
New location: Sumitomo Fudosan Iidabashi First Building, 2-5-1 Koraku, Bunkyo-ku, Tokyo

June 1989 (registration: May 1979)
Establishment
JPY 6,766,250,000
Capital
Number of Employees 20,795 (including 10,721 non-regular employees and others; Ryohin Keikaku Group)
For more information, please refer to the Ryohin Keikaku website.

WebsiteIR Information

Sustainability Information

https://ryohin-keikaku.jp/eng/

https://ryohin-keikaku.jp/eng/ir/

https://ryohin-keikaku.jp/eng/sustainability/

External Evaluations

In June 2021, Ryohin Keikaku was selected for the first time for inclusion as a constituent of the FTSE4Good IndexSeries and the FTSE Blossom Japan Index, which are leading ESG investment indexes.
The FTSE4Good Index Series comprises companies selected by FTSE Russell of the U.K. For inclusionin the index, companies must demonstrate strong performance and meet various evaluation criteria in terms of
ESG practices. These criteria are made based on international standards including the United Nations Sustainable
Development Goals (SDGs). The FTSE Blossom Japan Index is a specialized ESG index focused on companies
listed in Japan.
These indices have become benchmarks for investors who place importance on corporate social responsibility
and sustainability. Japan’s Government Pension Investment Fund (GPIF), the world’s largest public pension fund, hasalso adopted the FTSE Blossom Japan Index as a benchmark for its ESG investment management.

Recognition from Society

Ryohin Keikaku Recognized in the Sustainable Brands Index 2023
Ryohin Keikaku ranked first overall for the second consecutive year in the Japan Sustainable Brands Index 2023,
an SDG-focused brand survey of consumers conducted by Sustainable Brands Japan. The results were announced
at the International Conference on Sustainable Brands 2024 Tokyo-Marunouchi event organized by Hakuten
Corporation. The aim of the survey is to review corporate sustainability efforts from a consumer perspective andto examine how consumers’ perceptions of companies influence their consumption and recommendation patterns.
Ryohin Keikaku will continue to contribute to the communities where it operates and remain useful to its customers.

Ryohin Keikaku Wins 2023 IR Award
Ryohin Keikaku received the “Most Liked!” IR Award in the 2023 IR Awards program sponsored by the Japan
Investor Relations Association (JIRA). This particular award was newly established in 2020 to mark the 25thyear of presenting the IR Awards. It is determined by a vote of companies that entered the IR Awards. The
category was established to share the proactive IR activities of award applicants and encourage best practices.
The theme for 2023 was “IR department initiatives for human resource training and empowerment.” Ryohin
Keikaku was one of 21 companies selected out of 199 companies that entered.

Participation in Initiatives

United Nations Global Compact
Since September 2013, Ryohin Keikaku has participated in the United Nations Global Compact. We conductbusiness in accordance with the Global Compact’s ten principles in the areas of protection of human rights, theelimination of unfair labor practices, environmental responsibility and the prevention of corruption.

Platform to Ensure the Ethical and Fair Treatment of Foreign Workers (JP-MIRAI)
Since May 2022, Ryohin Keikaku has participated in the JP-MIRAI platform, which is based on international
standards, and is working with other companies and institutions to improve the working and living conditions offoreign workers in Japan.

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