1. FY2022 Board of Directors Actions to Enhance Effectiveness

Based on the results of the evaluation in the previous fiscal year (fiscal 2021), the following actions were taken to further improve effectiveness.

(1) Deepening of discussions on important management issues

In addition to focused deliberations by the Board of Directors on important management topics, in order to further increase the time for intensive deliberations in FY2022, we established an off-site meeting where all members of the Board of Directors participated and held discussions throughout the day, resulting in a lively exchange of opinions.

Topics in FY2022 Off-site Meeting

• Oil, fat, and meal materials supply-chain strategy
• Issues and initiatives to improve the price book-value ratio (PBR)
• Growth scenario to enhance corporate value
• Investor relations strategy for advancement toward becoming the world’s top oil and fat solutions company

Key Issues Discussed by the Board of Directors

• Strategic roadmap to promote decarbonization
• Progress report on transforming the Nagoya Plant into a smart factory
• Establishment of soybean and cacao procurement policies
• Concrete study of growth potential and profitability toward our 2030 vision
• Medium- to long-term investment plans
• FY2023 management plan
• Measures to increase corporate value in light of demands from capital markets

(2) Further strengthening of the monitoring functions of the Board of Directors including risk management

The following improvements were implemented to strengthen the monitoring functions of the Board of Directors:

• Verification of impact of the Russia-Ukraine situation on the Company’s large-scale capital investment plans
• Verification of capital cost levels in the Company’s business strategy
• Setting of specific topics in response to issues formed during the off-site meeting (growth scenario for the enhancement of corporate value, overseas business development, capital investment plans of domestic sites, etc.)

2. Details of the FY2022 Evaluation of Effectiveness of the Board of Directors

To evaluate the effectiveness of the Board of Directors in FY2022, we carried out a questionnaire-based survey on the items indicated below of the Directors and Audit & Supervisory Board Members who comprise the Board of Directors (13 persons in total), with support from an external agency to ensure objectivity.

1. (1) Composition of the Board of Directors
2. (2) Operation of the Board of Directors
3. (3) Deliberations by the Board of Directors
4. (4) Monitoring functions of the Board of Directors
5. (5) Performance of Inside Directors
6. (6) Performance of Outside Directors
7. (7) Structures for support of Directors and Audit & Supervisory Board Members
8. (8) Training
9. (9) Dialogue with shareholders (investors)
10. (10) Self-initiated measures
11. (11) Overall evaluation

Based on the survey results, a discussion was held between the President and all Outside Directors and Audit & Supervisory Board Members. The Board of Directors then discussed the results and made a final evaluation.

3. Evaluation Results

It was determined that the Company’s Board of Directors has attained effectiveness in general.
Individual topics relating to the evaluation results are as follows:

(1) Highly evaluated items

• Fundamental sustainability policies, efforts to improve them, and disclosure
• The fact that, from the perspectives of the Company’s sustained growth and the medium- to long-term enhancement of corporate value, Outside Directors are aware of and are properly fulfilling their role in monitoring management
• Feedback to the Board of Directors relating to the state of dialogue with shareholders (investors)
• The fact that the Company has designed a compensation system for Directors and Executive Officers and properly decides concrete compensation with reference to the information from the Compensation Advisory Committee

(2) Issues to be discussed and addressed intensively in FY2023, extracted from items with room for improvement

• Continued review and monitoring of measures to improve PBR
• Systematic identification of important risks and opportunities in management strategy and strengthening of their inspection and monitoring
• Enhancement of the management system’s practical effectiveness regarding the business strategies, investment effects, etc. of each business domain and Group company
• Setting of more appropriate key performance indicators (KPIs) for both financial and nonfinancial activities contributing to the sustained improvement of the Company’s corporate value

4. Measures to Further Enhance Effectiveness

Centering on issues selected for priority discussion and response based on the survey results, we will endeavor to further deepen discussions and adopt necessary countermeasures for further enhancement of effectiveness.

Meanwhile, in FY2023 we will continue to hold off-site meetings with the members of the Board of Directors, conduct intensive deliberations on management issues, and deepen understanding among Inside and Outside Directors, thereby striving to make continuous improvements to raise the effectiveness of the Board.