1. FY2023 Board of Directors Actions to Enhance Effectiveness

Based on the results of the evaluation in the previous fiscal year (FY2022), the following actions were taken to further improve effectiveness.

(1) Deepen discussions on significant issues on management

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 FY2023 Off-site Meeting

• Creation of values based on marketing and technology
• Initiatives concerning specialty fats and potential advances in related technologies
• Value creation strategies and initiatives in domestic business domains in the leadup to 2030
• Marketing innovation in the Food Product Division
• Marketing strategies in the Processed Oil/Fat & Soy Protein Division
• Vision for business in North America

Key Issues Discussed at the Board of Directors’ Meeting

• Measures for achieving ROIC targets (discussed twice)
• Concrete study of growth potential and profitability toward the 2030 vision
• FY2024 management plan
• Policies and targets concerning measures by the Company to increase corporate value and disclosure details
• Policy on shareholder returns
• Status of progress of the vision for business in North America

(2) Further strengthen 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:

• The Management Sustainability Committee was established in July 2023 for the purposes of deliberating on important issues such as proposing fundamental policies to achieve sustainable growth for the Group and sustained development of society.

  Key Topics Discussed

  Review of CSV targets and setting of new targets for FY2030 (deliberations conducted on multiple occasions)

  Specific measures for achieving the vision for business in North America

  Setting of risks and opportunities as priority areas (identifying new risks and opportunities, reviewing awareness of social issues, verifying priority areas, etc.)

  Measures for achieving ROIC targets (portfolio management approaches)

  Responses to the TCFD Recommendations

  Formulation of policies on biodiversity and water

  Sustainable soybean procurement and cacao procurement and action plans

• Specific topics were addressed in response to issues developed during the off-site meeting (growth scenario for the enhancement of corporate value, capital investment plans of domestic sites, etc.).

2. Details of the FY2023 Evaluation of Effectiveness of the Board of Directors

To evaluate the effectiveness of the Board of Directors in FY2023, a questionnaire-based survey was carried out 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

As a result of this fiscal year’s evaluation, it was determined that the Company’s Board of Directors has attained effectiveness in general. Since FY2021, the evaluation scores have increased each year over the course of the three evaluations, and it was determined that the measures for enhancing the effectiveness of the Board of Directors have led to higher scores.

The following are the issues to be discussed and addressed intensively, extracted from items that were highly rated in the survey results and items with room for improvement, and will continue to be addressed this fiscal year.

(1) Highly evaluated items

• The fact that adequate discussions are held based on an awareness of compatibility between the Company’s sustained growth and the medium- to long-term creation of corporate value with management strategies and plans
• 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
• The fact that 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

(2) Issues to be discussed and addressed intensively in FY2024, identified from items with room for improvement

• Implementation of adequate deliberation on potential risks in Groupwide management strategies and plans and methods of responding to those risks
• Continued review and monitoring of measures to improve PBR
• Determination and periodic review of Groupwide business portfolio policies
• Reinforcement of group governance and internal controls over Group companies
• Management of human capital

4. Measures to Further Enhance Effectiveness

To further enhance the effectiveness of the Board of Directors, in addition to addressing issues selected for priority discussion and responses based on the survey results, the Company will endeavor to further deepen discussions and adopt necessary countermeasures regarding opportunities, risks, and so on that will have an impact on the Company’s business. In FY2024, the Company will hold another off-site meeting by members of the Board of Directors; will conduct intensive deliberations on management issues; and will work to deepen understanding among Inside and Outside Directors.

Through these measures that will contribute to enhancing the effectiveness of the Board of Directors with the aim of improving corporate value, the Company will strive to make a leap forward to become a world-leading provider of oils and fats solutions.