■ Fujibo Holdings <3104>'s commitment to esg.

The company has been publishing a sustainability report annually, but starting in 2024, it will issue an "integrated report" instead of the "sustainability report." The company's first "Integrated Report 2024" (to be published on September 30, 2024) will not only introduce financial information but also highlight the company's strengths, growth strategy, and efforts in sustainable management, providing comprehensive insights to investors and other stakeholders.

1. Sustainability Basic Policy

The company group practices "sustainable management," which incorporates sustainability as the core of its business strategy. The sustainable management of the company group aims to achieve sustainability by executing a fair and transparent SDGs management that balances "profitability," "growth potential," "profitability," "social contribution," and "integrity."

2. Identification and promotion of five materialities/important issues.

To realize a sustainable society, the company group analyzes the impact of its business activities on stakeholders, the economy, society, and the environment. Based on the idea of "double materiality," which integrates investor perspective materiality (financial materiality) and stakeholder perspective materiality (environmental and social materiality), five materialities have been identified.

(1) Sincere efforts towards achieving a sustainable environment and society.

To maintain the sustainability of the global environment, efforts are made to conserve natural environments and biodiversity, promote effective resource utilization, and aim to establish a stable and sustainable procurement and supply system.

(2) Adaptation to Climate Change

Efforts are being made to reduce the environmental impact of business activities toward a decarbonized society, and to appropriately respond to the impact climate change will have on companies in the future.

The company recognizes climate change response as an important management issue for achieving a low-carbon society, and in November 2021, agreed to the TCFD (Task Force on Climate-related Financial Disclosures) recommendations, which serve as guidelines for disclosing information related to climate change. Important information related to climate change is being disclosed in accordance with the TCFD recommendations. Additionally, a response was provided to the CDP※ questionnaire (climate change), and an evaluation of 'B-' (an improvement from the previous 'C' to management level) was received.

※ CDP is a UK nonprofit organization that sends questionnaires (covering climate change, forests, and water security) to various companies on behalf of investors, analyzes and evaluates the companies' responses, and discloses the results.

(3) Co-creation of Value with Diverse Stakeholders

Through business activities, importance is placed on dialogue with a variety of stakeholders, contributing to the sustainable growth and development of local communities, etc.

(4) Creating an Environment that Accepts Diversity and Maximizes Individual Abilities

Respect diversity irrespective of gender, age, nationality, etc., and promote the development of a workplace environment where individuals can feel secure and demonstrate their abilities.

(5) Enhancing corporate governance and thoroughly implementing compliance and risk management.

While practicing highly transparent management, maintain a risk management system to prevent accidents and fraud in advance, aiming for sustainable growth.

In addition, in terms of the environment, as of the fiscal year ending March 2024, CO2 emissions (Scope 1 and Scope 2): 59.9 thousand tons (a decrease of 3.1 thousand tons compared to the previous period), and CO2 emissions (Scope 3): 94.0 thousand tons (a decrease of 15.9 thousand tons compared to the previous period), progress is being made in reducing environmental impact. Additionally, in terms of governance, out of the nine directors, there are four external directors, including two women (one of whom is a foreigner), indicating smooth progress in management diversity.

3. Sustainability Promotion System

In line with the launch of the mid-term management plan 'Strengthening 21-25', the company established the 'esg Promotion Committee' in April 2021 to promote sustainability management across the entire group through addressing important issues related to the SDGs. The 'esg Promotion Committee' is chaired by President Inoue and consists of three subcommittees: Environment, Social, and Governance. The mission is to appropriately address sustainability issues related to the company group and to make proposals that link sustainability efforts to the enhancement of corporate value in the medium to long term. Each subcommittee works on various issues related to the promotion of sustainability, and based on their importance, a system is in place to consult with the esg Promotion Committee, management meetings, and the board of directors. The board of directors makes the final decisions on important policies and measures regarding overall management, as well as overseeing management meetings, the esg Promotion Committee, and others.

(Written by: Fisco guest analyst Keiji Shimizu)