1. Board of Directors Actions to Enhance Effectiveness in Fiscal 2024

Based on the results of the evaluation in the previous fiscal year (fiscal 2023), the following actions were taken to further improve effectiveness.

(1) Deepen discussions on significant management issues

In addition to conducting focused deliberations at the Board of Directors’ Meeting on important management topics, an off-site meeting was held with the participation of all members of the Board of Directors resulting in a lively exchange of opinions throughout the day.

Topics Discussed at the Fiscal 2024 Off-Site Meeting

• Strategies for technology to realize oils & fats solutions
• Way forward for the further expansion of oils & fats solutions (marketability of functional oil, and business strategies)
• Business proposals for confectionery fats with a focus on 2030 and beyond
• Way forward in the medium to long term for the household-use business
• Aiming for growth in the wellness foods business, with a focus on 2030
• Digital innovation strategies
• Aiming for the formulation of the next medium-term business plan

Key Issues Discussed at the Board of Directors’ Meetings

• ROIC-driven management
• Rebuilding the production system with a 50-year outlook (discussed multiple times)
• The next medium-term business plan (including human resource strategy) (discussed multiple times)
• Comprehensive design for the palm oil business and the restructuring of the refining stage and subsequent production processes

(2) Further enhance the monitoring functions of the Board of Directors

The following efforts were undertaken to enhance the monitoring functions of the Board of Directors:

• Discussions were held within the Management Sustainability Committee, an advisory body to the Board of Directors, on broader sustainability issues.

  Key Topics Discussed

  Setting of opportunities and risks as priority areas (identification of material risks)

  The next medium-term business plan and revised CSV (Creating Shared Value) goals (deliberations conducted on multiple occasions)

  Strategic roadmap to promote decarbonization

  Approach to new sustainability disclosure standards

  Strategic investor relations

• The formulation of the next medium-term business plan was deliberated, based on issues identified at the off-site meeting and the strategy for medium- to long-term value creation.

2. Details of the Fiscal 2024 Evaluation of the Effectiveness of the Board of Directors

To evaluate the effectiveness of the Board of Directors in fiscal 2024, a questionnaire-based survey was carried out, focusing 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 a third-party institution 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 Internal Directors
6. (6) Performance of Outside Directors
7. (7) Support systems for Directors and Audit & Supervisory Board Members
8. (8) Training
9. (9) Dialogue with shareholders (investors)
10. (10) Implementation of initiatives by each member
11. (11) Overall evaluation

A discussion was held between the Representative Director & President and all Outside Directors and Audit & Supervisory Board Members regarding the results of the survey. The Board of Directors then discussed the results and made a final evaluation.

3. Evaluation Results

As a result of this fiscal year’s evaluation, it was determined that the Company’s Board of Directors has attained effectiveness in general. The evaluation scores have been increasing since fiscal 2021, and it was therefore concluded that the measures for enhancing the effectiveness of the Board of Directors have led to the higher scores.

This fiscal year, the Company will organize and address the key issues extracted from the items that were highly evaluated in the survey results, as well as those with room for improvement, and continue to take measures accordingly.

(1) Highly evaluated items

• The Board of Directors has identified actions from the perspective of both risks and opportunities in addressing ESG issues and the SDGs, and has appropriately incorporated them into management strategy to support the creation of medium- to long-term corporate value.
• Outside Directors are aware of their roles in supervising management from the perspectives of the Company achieving sustained growth and improving corporate value over the medium to long term and adequately fulfill their roles in response to the trust placed in them by shareholders.
• The Board of Directors is functioning effectively overall.

(2) Issues to be discussed and addressed intensively in fiscal 2025, identified from items with room for improvement

• Management system focused on improving the PBR (price-to-book ratio)
• Human resources strategy and management system that contribute to sustainable growth
• Decision-making on the Group-wide business portfolio policy and conducting regular reviews
• Review of the management and supervisory structure to reinforce Group governance and internal controls over Group companies
• Group-wide identification of potential risks and corresponding responses, as well as the crisis management structure, in view of rapid changes in the business environment and heightened uncertainty

4. Measures to Further Enhance Effectiveness

In order to further enhance effectiveness, the Company will continue to deepen discussions and take necessary measures, focusing on key issues extracted from the survey results that require priority deliberation and action. To become a global top provider of oils & fats solutions, the Company will work toward achieving the goals set forth in the Medium-Term Business Plan Value UpX by diligently addressing and resolving growth-inhibiting challenges and changes in the internal and external environment.

In fiscal 2025, the Company will continue to hold an off-site meeting of the Board of Directors to focus on management issues, foster deeper communication between Internal and Outside Directors, and continuously improve the effectiveness of the Board of Directors.

The Company recognizes the enhancement of corporate governance as a key management issue and will actively promote engagement with our shareholders and investors to that end.