Board of Directors’ Opinion on Shareholders’ Proposal

Proposal Details and Board of Directors' Opinion

The proposing shareholders submitted proposals including changes to the Articles of Incorporation to transfer the decision-making authority for surplus dividends and other surplus distributions from the Board of Directors to the General Meeting of Shareholders, surplus disposal, and a revision of remuneration including restricted stock compensation to directors (excluding outside directors). The Board of Directors expressed opposition to all these proposals, citing concerns about hindering sustainable growth, reducing the agility of capital policy, and potential mid- to long-term damage to shareholder value.

Details of Opposition Reasons and Future Outlook

The Board emphasizes the importance of executing flexible and agile capital policies, highlighting the need for an optimal combination of dividends and share buybacks. It also points out the mismatch of the current reward system with the average PBR of the TSE Prime Market and stresses the importance of a comprehensive evaluation process for remuneration decisions. The Company plans to maintain the current capital policy and compensation system moving forward, aiming for continuous improvement in shareholder value.