The Teijin Group maintains the belief that corporate culture has a close relationship with innovation. Guided by this belief, we aim to foster a new corporate culture that is agile, innovative, and inclusive. To that end, we launched an initiative to transform our corporate culture, the "Power of Culture Project," in September 2020. Under this project, we aim to clarify the desired corporate culture for the Group and promote reforms geared toward realizing that culture.

As the first stage of this project, in FY 2020 all corporate officers in Japan and overseas gathered together to discuss the kind of new corporate culture we should foster and what actions need to be reinforced to foster such a culture. As a result of this discussion, the Group's management agreed to the new Teijin Group Leadership Charter, thereby demonstrating its commitment to reform.

In FY2021, we held a series of workshops in Japan and overseas, for general managers and core talent below executive level. First, we formulated our own commitments through an understanding the direction of the transformation based on the Leadership Charter as well as the need for it. A few months later, we shared with each other the status of the implementation of the commitments we had made. We expect the introduction to the senior management to be almost complete by the end of the three-year plan at the end of FY2022.

In FY2021, we established the "Designing the Future Award" to commend outstanding initiatives that have yet to show economic effects in the three domains of "Diversity and Inclusion," "Innovation," and "Sustainability."

The award is open to all Teijin Group employees. In the first year 58 applications were received globally and five awards were conferred after two rounds of screening. More than 120 people participated from all over the world in the online award ceremony. The ceremony also featured a demonstration of the executive team's commitment in actively supporting challenges the employees take on.

We are committed to building a corporate culture that promotes collaboration among organizations and innovation creation while also sharing these values within the Group and globally.

In FY2021, we commenced a global engagement survey targeting roughly 19,500 employees around the globe in an effort to ascertain employee awareness of the Company and relevant organizations and employee willingness to contribute to performance.

In the first round of this survey, around 60% of the participants responded with "very satisfied" or "satisfied" and about 30% answered "normal," indicating that the level of engagement was overall good.

Going forward, we aim to continue to implement measures for improvement for issues at the department and section level through regular surveys. Establishing an inclusive and highly engaged environment in which all employees can demonstrate their skills to the greatest extent possible will enable our employees to contribute to the success of our business activities. We are committed to the realization of our long-term vision through the implementation of the PDCA cycle for engagement surveys.

The Teijin Group first created a specialized organization to promote the empowerment of women in 2000. Since then, we have created systems and conducted training and education to achieve four objectives: Expand the population of female employees, promote a good work-life balance, foster a corporate climate of diversity and inclusion, and support the career continuation and enhancement of women.

Since 2002, we have set goals for number of female managers in Japan and the heads of each business and function (officers) have set KPI for individual businesses and functions and supported the development and careers of female employees. In addition, CHO reports on the status of diversity and inclusion to the Board of Directors.

Further, Empowerment of Women's Advancement training (half-year training that includes group training, action learning, and presentations) is continuously conducted for selected employees of major Group companies in Japan, who are one step away from a management position. In FY2021, which is the eleventh time this program has been conducted, 28 employees participated, bringing the total number of participants to 226. Among them, there are who are currently enrolled in a select program for core human resources and those who have been promoted to management positions where they are exhibiting leadership at their workplaces.

Changes in number and ratio of newly recruited career-oriented female university graduates

• *Figures are totaled based on number of employees recruited as of April of each fiscal year.
• *Four core group companies in Japan: Teijin Limited, Teijin Pharma Limited, Teijin Frontier Co., Ltd., Infocom Corporation

Changes in number of female employees in managerial positions

• *Data as of March 31 of each fiscal year
• *Four core group companies in Japan: Teijin Limited, Teijin Pharma Limited, Teijin Frontier Co., Ltd., Infocom Corporation
• *Percentage of female employees in managerial positions of the total number of managerial positions in the companies.

There are few female role models in positions such as sales, research and development, and engineering compared to other jobs. In FY2021, we held online workshops conducted by guest lecturers to encourage young sales employees to know about the theory of mind necessary for sales. In addition, round-table discussions were held with senior employees to develop the career awareness of women in science and technology who are engaged in research and development, among other things.

At the same time, in our participation in the "Riko-challe" sponsored by the Cabinet Office for the first time, we entrusted our group of young science and engineering employees with everything from planning to operations, and were thus able to build a network transcending business and organizational boundaries.

Some employees must unavoidably interrupt their careers when a spouse is transferred overseas. We established a leave program for employees accompanying a spouse to an overseas assignment that permits leaves of up to three years so that these employees can continue their careers. While on leave, some employees study a language or engage in other self-development and enhance their work skills and then return to work. To date, 22 employees have made use of this program.

Teijin Limited and Teijin Pharma Limited have established the Hello-Again system for employees who left the companies for reasons including marriage, pregnancy, child-rearing, nursing care, or work transfer of their spouses. Employees in this situation who wish to return to the Teijin Group due to the reason for leaving no longer applying will be rehired as full-time employees on the condition that it is not more than 10 years since they left and if the need exists. Up to the end of FY2021, 14 employees who had left the companies had been rehired through the Hello-Again system.

We have also established a system by which employees at all domestic group companies may continue to work after retirement. In FY2021, a total of 46 employees continued to work after retirement at 43 group companies.

As of April 1, 2022 at 31 group companies (consolidated) subject to a legal requirement to employ people with disabilities in Japan, the total number of employees with disabilities* was 275, more than the 272 specified by the related laws and regulation. Due to the large impact of the higher statutory employment rate and the retirement effective from March 2021, etc., 16 individual companies failed to meet the legal requirement for employment of people with disabilities. In FY2022, we will share successful cases of hiring employees with disabilities in each company in an attempt to employ more people than the recruitment number required by laws and regulation.

In February 2019, Teijin Limited established the special subsidiary Teijin Soleil Co., Ltd., with the objective of creating workplaces in which people with disabilities can experience the satisfaction and enjoyment of working. Teijin Soleil offers a diverse range of workplaces and work duties mainly in agricultural work (cultivation and sale of produce and flowers) and office support (administrative assistance). In April 2021, we launched a new office support team in Iwakuni district. In addition, we established a support team and started a cleaning business in the Hino district as well in June 2021. Since then, we have continued working to expand the range pf work duties and work sites in each region.

• *Number of employees with disabilities does not refer to the headcount, but to number of persons with disabilities calculated taking into consideration the type of disability and the working hours. These form the basis for calculating the employment rate of persons with disabilities as per the employment quota system for persons with disabilities.

In April 2020, the Corporate human resources organization was established under the Human Resources Division. Our aim is to build and operate a globally shared human resources system that can foster and manage human resources at our bases in Japan and overseas.

In FY2021, in order to address personnel issues, we established a section-level organization under the regional HR directors in Europe and the Americas, and strengthened functions related to talent management, D&I, human resource development, and recruitment.

In FY2021, we identified four candidates for overseas dispatch as part of the Overseas Practical Training Program launched in FY2019 as a new initiative, (which aims to enable young employees to gain practical experience at overseas group companies, hone their international awareness, and build interpersonal networks). Although the dispatch period of some candidate employees was changed due to the COVID-19 pandemic, we dispatched two people during FY2021. (Dispatch of the remaining two has been deferred to FY2022).

In FY2021, we proactively pushed forward with initiatives to recruit global human resources, including participation in seminars for foreign university students on exchange in Japan. As a result, we hired one student of foreign nationality and 11 individuals with extended experience living or studying overseas as new career-oriented recruits in FY2021.

In 2003, we established the Teijin group basic human resources policy.

The medium-term management plan from FY2020 to FY2022 positions the promotion of diversity and inclusion as a priority measure for the creation of innovation. We are promoting the diversification of work styles, the empowerment of women, and the diversification of human resources more than ever and accelerating the revitalization of organizations and creation of innovation.

Based on the results of the discussions we held as part of the Power of Culture Project, we established new leadership development programs in FY2020. The new programs incorporate strategic assignments, external personnel evaluations, and mentoring as well as KPIs on female employee and employee of foreign nationality participation.

In fiscal 2021, all corporate officers undertook mentor training, and with respect to core human resources, mentoring was conducted for 11 persons.

The following programs are implemented with a view to developing core human resources who will forge the future of the Teijin Group. In FY2021, we reviewed our core human resources development program, and in STRETCHⅠ and STRETCHⅡ we changed the system so that personnel from all countries, regardless of their country of origin, receive the same training with English as the common language.

The Teijin Group promotes and encourages self-development based on the independent study of each and every employee and coordinates on-the-job training, a job rotation/appointment system and other training programs as part of a systematic approach to developing Group human resources.

The Teijin Group has set a range of measures to ensure that employees are appointed to positions based on their desires and suitability for positions with consideration to Group-wide human resources needs.

In relation to personnel transfers, we have established an annual personnel plan at all group companies, aiming to realize objectivity and transparency in relation to transfers. group companies in Japan also have a self-application system that respects each employee's desire regarding transfers and new appointments. Additionally, in as early as 1988, we introduced an in-house staff recruitment system (Job Challenge System) that was pioneering for Japanese companies at the time. In FY2021 10 people were transferred using this system.

Furthermore, from January 2018, we introduced the "FA (Free Agent) System" to release employees to the business unit they wish to be transferred to in order to match their abilities, experience and so on, and made the selection of transfer destination possible. 10 people used this system in FY2021.

We also implement systematic transfers of core human resources selected for STRETCH from among group companies worldwide, with the transfers extending beyond business departments and country borders.

At group companies in Japan, we also review the appointment status of contract employees and temporary staff every year. In FY2021, reviews were conducted at 29 group companies in Japan. We will continue to check the status on a regular basis.

The Teijin Group training and job rotation / transfer system

1. *1Succession plan: A plan to foster successors to important posts from the viewpoint of business continuity.
2. *2Strategic Executive Team Challenge (STRETCH): A group core human resources development system for leaders.
3. *3Junior Management Program (JuMP): A leadership training program for mid-level employees aimed at developing executive talent.
4. *4Specialty Development Program (SDP): An educational program designed to enable career-oriented employees to gain specialized knowledge relating to marketing, engineering or clerical work.
5. *5Job Challenge System: An in-house staff recruitment system. Any employee can file an application for a position without permission from the division manager, and the manager cannot overrule decisions.

In FY2019, Teijin Limited and Teijin Pharma Limited introduced telework programs that allow employees to work outside the office even in the absence of a reason such as childcare or family care.

We are also making full use of the telework program as a means of preventing the spread of COVID-19 infections, and to this end, we have implemented the following temporary measures: (1) elimination of the limit of 70 hours of telework per month; (2) payment of telework duty allowances; (3) allowing newly-hired recent college graduate employees, part-time employees, and temp workers, who were previously excluded, to use the telework program; and (4) use of empty rooms in company housing as satellite offices.

In addition, as a temporary measure to deal with the temporary closure of schools nationwide, we relaxed the criteria for availing independent paid leave apart from annual paid leave, granted special leave, and compensated for the cost of using babysitters, among other things.

By adopting these measures, we are working to reduce the risk from the COVID-19 infections while increasing the flexibility of workstyles and enabling employees to demonstrate their full capabilities.

For some time now, group companies in Japan have been utilizing a system that requires applying for overtime in advance and actively promoting no-overtime days.

In FY2021, the four core group companies* in Japan reported an average overtime of 13.6 hours per month (an increase of 1.7 hours compared to FY2020). The utilization of annual paid holidays was 76% (an increase of 1 point compared to FY2020). In FY2022, we will strive to improve results as compared to the previous fiscal year, with the aim of further reducing actual working hours.

In order to realize appropriate working hours, we are using IT tools and external consultants to conduct survey on work and work visualization and exerting all efforts to comprehensively revise tasks (IT utilization, standardization of operations, making meetings efficient, etc.). As a specific measure we are prioritizing the development of RPA (Robotic Process Automation) to promote the reduction of working hours and the optimization and equalization of labor loads by automating and improving the efficiency of operations.

The Teijin Group in Japan has set the goal of "overall actual working hours of 2000 or less for all employees and 10 days or more of annual paid leave." At present, this is yet to be achieved, but we are committed to achieving this goal while building a new way of working in anticipation of a post-corona era.

• *Four core group companies in Japan: Teijin Limited, Teijin Pharma Limited, Teijin Frontier Co., Ltd., Infocom Corporation

In group companies in Japan, besides preparing a support manual to promote supervisors’ understanding and smooth communications with female employees during pregnancy or before/after maternity leave, in order to promote childcare leave for male employees, activities that raise awareness of the importance of promoting childcare leave, among other matters, have been incorporated into action plans based on the Act on Advancement of Measures to Support Raising Next-Generation Children (Amended Next-Generation Act). For example, we have been sending individual monthly e-mails to male employees eligible to take childcare leave and their superiors in order to provide information about how to obtain childcare leave and other related matters. This aims to create an environment in which it is easy for male employees to take childcare leave.

In FY2021, a total of 204 employees took childcare leave at the four core group companies in Japan. Of these, number of male employees who took childcare leave was 76, and although there is variation depending on the number of children born, the gender gap for employees taking childcare leave is narrowing. We will continue to conduct awareness raising activities so that employees can start planning to take childcare leave before they have children. At the same time, we will work to develop a workplace environment that is conducive for male employees to take long-term childcare leave.

Trends in number of employees taking childcare leave

Our nursing care leave system operating at three of the four core group companies in Japan allows each applicant to take up to 730 days of nursing care leave per reason (also obtainable in portions). This far exceeds the total of 93 days of leave specified under the Child Care and Family Care Leave Law.

In addition, the systems for nursing care reduced working hours, flexible work start/finish time, etc. can be used for as long as an employee is providing nursing care.

In FY2021 there were 2 employees taking nursing care leave and 3 employees on shorter working hours for nursing care, for the four core group companies combined.

The baby boomers generation will be reaching late elderly age in the future, and an increase among the current generation of workers who are providing nursing care while working is expected. We will continue to hold seminars to raise awareness and strive to foster a corporate culture with a good work-life balance.

With a view to encouraging volunteer activities, the Teijin Group has introduced a paid Volunteer Leave System at Teijin Limited and Teijin Pharma Limited. As of March 31, 2022, there were 15 employees using the Volunteer Leave System.