Fujikura Ltd. believes the corporate governance system discussed herein is optimal for achieving the company’s growth strategies. Fujikura has adopted a “company with Audit and Supervisory Committee” organizational structure to establish such a corporate governance system.

Fujikura believes a structure, whereby the Board of Directors thoroughly and extensively explores important matters, including the annual and Mid-term Business Plans, which are the core of our growth strategies, large-scale M&A deals, etc., needs to be built so that proper decisions can be rendered. To facilitate this approach, Fujikura believes that a system can be realized that allows the Board of Directors to thoroughly and extensively explore and discuss vital matters to arrive at an optimal decision by having in addition to our internal executive directors, who are well-versed in the businesses managed by each In-house Company, a plurality of outside directors who have diverse knowledge and objective opinions, which are not influenced by Fujikura’s internal state of affairs.

At present, there are four outside directors: two with corporate management experience (in the finance and manufacturing industries, respectively) and two others (one a lawyer and the other a certified public accountant).

Fujikura designates all outside directors that satisfy the criteria for independent officers as independent officers.

A survey is conducted on the effectiveness of the Board of Directors and applies to all directors. The survey includes questions on the adequacy of Board meetings overall (time, frequency, management of meeting proceedings, minutes, etc.), adequacy of agenda items (timing, importance, volume of information, etc.), aspects of Board members (participation in discussions, etc.), and executive office function. Fujikura considers the results of the survey and takes remedial measures as necessary.

Specifically, in order to further enhance the deliberation of the Board of Directors, aimed at obtaining a deeper understanding from outside directors, Fujikura holds briefing sessions on its products and individual projects for outside directors, and prepares for important matters in advance with briefing sessions.

At Fujikura, the Board of Directors decides on remuneration of each individual director based on (1) results of surveys - conducted by several research institutes of primarily publicly listed companies - used as a reference, and (2) a report received from its advisory body, the Remuneration Advisory Committee (the majority of committee members are outside directors and the committee is also chaired by an outside director). The Remuneration Advisory Committee discusses the performance evaluation of each director, whether remuneration standards for each position are in line with the market, as well as the remuneration system. The committee submits a report on individual director remunerations, which takes into account findings for each of the areas discussed. The Board of Directors then issues a decision on director remuneration based on the committee’s report.

The above compensation system represents a compensation system for executive directors only, and compensations for non-executive directors, in light of their duties, comprises exclusively a fixed amount as basic compensation, and does not include short-term performance-based compensation or stock-basedcompensation.

Fujikura does not, in principle, hold shares as a policy. However, in the course of its business activities, it is necessary for Fujikura to enter into strategic business partnerships, in which case Fujikura strategically holds shares of its partners exclusively if it contributes to an increase in corporate value over the mid to long-term.

In addition, Fujikura sells off shares that it has decided to stop holding, and the Board of Directors receives reports on the sell-off of these shares. The Board of Directors determines whether the shares that Fujikura holds should continue to be held. In making this decision, the Board of Directors treats the shares as capital invested in each In-house Company, and it considers whether holding the shares would contribute to the above purpose.

Fujikura has established a corporate pension fund (the Fujikura Corporate Pension Fund) to which it has entrusted the management of Fujikura’s pension assets. Fujikura Corporate Pension Fund subcontracts the entire management of the assets to asset management firms and monitors the management of those assets.

Fujikura takes care to provide Fujikura Corporate Pension Fund with the necessary personnel and organizational structures to ensure that the fund can monitor the asset management firms (which manage the assets in practice) effectively.

Fujikura promotes initiatives by which the President and senior management can engage in dialogue with shareholders and investors as a means to achieve sustainable growth and increase corporate value over the mid to long-term.

Fujikura places a director in charge of handling constructive dialogue to ensure the effectiveness of dialogue and information disclosure, under whom the IR Group of the Corporate Strategy Planning Division is set up and that cooperates with related departments to conduct a timely, fair, and adequate disclosure of information.

For the purpose of preventing the leakage of financial information and ensuring fairness, Fujikura has established a quiet period. During this quiet period, Fujikura does not make any comments about its financial information neither responds to questions about this information. In addition, pursuant to its internal information management rules, Fujikura endeavors to prevent the leakage or proliferation of important information, and to prevent insider trading.

Fujikura and the Fujikura Group are making efforts to disclose information promptly, including disclosure on the Tokyo Stock Exchange and release to press. On the "Investor Information" page of the Fujikura website, we will post the quarterly financial disclosure schedule, quarterly performance disclosure material, medium-term management plan material, new business, research development results, press release of the establishment of a new company, in Japanese / English We are trying to enrich it, including posting in.

In Japan, we provide quarterly accounts settlements for institutional investors and securities analysts. During the interim period and fiscal year-end, the top executives explain the results and the progress of the mid-term plan at the results presentation meeting.

Overseas, the president and director in charge of IR visit Europe, North America and Asia directly to institutional investors to explain our business outline, account settlement explanation, and medium-term management plan. In addition, we visit investors as appropriate, and we are trying to enhance dialogue by having a forum for exchanging opinions on the general meeting of shareholders, corporate governance system, ESG etc.

In addition to sending a business report, we provide information on a website in a timely manner to individual investors, and the IR Group handles inquiries about business results as a contact point.